Promoting Energy Infrastructure, Creating Opportunities, and Enhancing Reliability

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Promoting Energy Infrastructure, Creating
Opportunities, and Enhancing Reliability

• Business Continuity Strategies
• Houston, TX
• November 9-10, 2006

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Agenda

• WPA what are we?
• National production history, forecast
• Wyoming and Colorado specific
• Pipeline infrastructure
• Socioeconomic impacts
• Other commodities

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Source 10/30/06 Raymond James
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-2.88
-1.07
2.51
Source EIA
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Regional Natural Gas Production is Growing 260
MMcfd/yr(Note much of CO production comes from
the San Juan Basin)
8,496 MMcfd
8,754 MMcfd
8,955 MMcfd
Source EIA
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Wyoming Natural Gas
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Colorado Natural Gas
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Garfield County, Colorado
Colorado Oil and Gas Commission
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Natural Gas Infrastructure
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1997
SourceEIA
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Total of 2.1 Bcfd of export capacity added in the
Rockies over the past 5 yrs (pre REX)
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Current Constraints

• Wamsutter to Cheyenne
• Nearly all Export Points

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WBI Grasslands
NWP PNW
Kinder Trailblazer
Kinder Pony Express
Southern Star
Kern River
El Paso Cheyenne Plains
NWP SJB
Kinder TransColorado
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Approximate Pipeline Capacity Out of the Rockies
on 9-12-2006
2,300 Available
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Note That Winter Demand in the Rockies is
SubstantialPeak Day gt 3.5 Bcfd

• Denver
• Salt Lake City

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Note That Storage Injections in the Summer Help
Augment Pipeline Takeaway Capacity

• Clay Basin Storage (Questar)
• Elk Basin Storage (WBI)
• Young Storage (XCEL/El Paso)
• Fort Morgan Storage (El Paso)
• Huntsman Storage (Kinder)
• Clear Creek Storage (Questar)
• ..

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THE FUTURE!

• 1.8 Bcfd
• 42 inch diameter
• 1,323 Miles

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• WIC Piceance Lateral
• REX Zone 1 (formerly Entrega)
• Questar Overthrust
• WIC Mainline

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Storage Opportunities
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Socioeconomic impacts
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Energy Price Sensitivity

• Crude Oil ? 0.25 per bbl. change
• 1.6 million revenue change.
• Coal ? 0.25 per ton price change
• 13.6 million revenue change.
• Natural Gas ? 0.25 per mcf change
• 50.7 million revenue change.

Note revenue sources include severance taxes,
federal mineral royalties, and the school
foundation portion of ad valorem taxes (based on
FY06 projections). Source January 2006 CREG
Forecast and Legislative Services Office.
Wyoming Economic Analysis Division
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Current Economic Conditions

• Upside - Energy continues to bolster the economy!
• Net population in-migration last 4 years.
• Jobs, jobs, jobs!!!
• 8,800 (3.4) between April 2005 to April 2006.
• Consumer spending continues to climb.
• Retail sales taxes up 14 from year ago.
• State revenue out-pacing forecast.
• General Fund ahead 7.4 (65 million).
• Gross State Product soars in 2004.
• GSP increased 7.6 to 24 billion ranked 12th
  in U.S. (6.7).

Wyoming Economic Analysis Division
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Current Economic Conditions

• Downside Influx of workers stress communities.
• Increases traffic, domestic violence, drug use,
  911 emergency services.
• Housing shortage escalating property values,
  affordable housing becoming non-existent.
• Lodging shortage accommodations for travelers
  short supply.
• Population low growth and net in-migration.
• Transient versus permanent population.
• Uneven growth energy boom is spreading wealth
  unevenly across state.
• Low industrial diversification.
• Workforce availability strong regional
  competition for construction labor/ in-state
  competition from growing mining industry.
• 4Q05 inflation hits 5 U.S. at 3.4

Wyoming Economic Analysis Division
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8,400
7,600
6,200
6,100
5,400
2,500
2,100
Forecast
Wyoming Economic Analysis Division
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Investing in the future

• Education is top priority
• 400 million Hathaway Scholarship Program.
• 105 million endowed professorships
• 2 billion K-12 education funding.
• Other
• 564 million Permanent Wyoming Mineral Trust
  Fund.
• 100 million tax cut (sales tax on groceries.)
• 40 million Wildlife Trust Fund (conservation
  grants, habitat improvement.)
• Infrastructure increased bonding authority from
  1 billion to 3 billion.
• Capital improvements schools, prison, state
  buildings.

Wyoming Economic Analysis Division
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Other commodities
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Crude Oil

• Prices have rebounded since Spring 06.
• Pipeline infrastructure is tight but no consensus
  on new outlets lets talk!
• Refining expansions and new refining initiatives
  are expensive and have lengthy permitting lead
  times.
• Production continues to grow in the region.

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CO2 Infrastructure and Announced Advanced Coal
Sites
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www.wyopipeline.com
Colby Drechsel Associate Director cdrechsel_at_qwest.
net 307.259.8459 152 North Durbin Street, Suite
230 Casper, Wyoming 82601Office (307)
237-5009Fax [phone] www.wyopipeline.com