# Natural-Gas Boom and Coming Bust in Colorado

L. David Roper
http://www.roperld.com/personal/RoperLDavid.htm
6 March, 2018
World Fossil Fuels Depletion

## Introduction

The U.S. state of Colorado is having a boom in extracting natural gas by the technique of fractionating ("fracking") shale/dolomite formations. A "boom" in nonrenewable resource extraction from the Earth is defined as a time period in which extraction is occurring very fast in a given area; thus, many workers come in from outside the area to man the drilling rigs, to build housing for the oil workers and to provide other services for the increased population.

This article shows mathematically that the Colorado natural-gas boom will become a bust within a decade. A "bust" in nonrenewable resource extraction from the Earth is defined to begin at the time when extraction of the resource peaks and then falls to negligible amounts over a time period.

## Natural-Gas Extraction Data for Colorado

The U.S. Energy Information Administration gives monthly and annual natural-gas extraction data for Colorado since 1981.

Those data are fitted by a depletion function, the Verhulst function, in this study to determine when the extraction will peak.

The data and the fits to the data are given in a later section.

A reliable estimate of reserves is needed to fit extraction data by a function for projecting into the future for a nonrenewable resource Here is a good definition of reserves of a nonrenewable resource.

The U.S. Energy Information Administration gives reserves estimates from 1977 to 2016 for natural-gas extraction in Colorado, which are shown here by black dots for years 2006 to 2011:

The curve is a fit to the data for 1997-2011 using the Verhulst function described in the next section. The fit is done to get a rough estimate of the peak value of the reserves estimate in the future, which is ~24 x 1012 ft3.

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## Verhulst-Function Fit to Natural-Gas Extraction Data for Colorado

The asymmetry parameter, n, must be greater than 0.

where

The maximum of P(t) occurs at , which yields the peak value  .

For the symmetric case (n=1):  and .

For a depletion situation for which there are N peaks the depletion function is:

.

When a peak is symmetrical, the Verhulst function simplifies to

.

The depletion curve for natural-gas extraction for Colorado has essentially three peaks; so N=3 in the depletion equation. The fit to the extraction data using the reserves peak, 24 x 1012 ft3, given in a previous section is:

The area under the curve is equal to the amount already extracted (~33.8 x 1012 ft3) plus the reserves value (~256 x 1012 ft3).

The fit to the data for early years, showing the early peaks, is:

If this reserves value (~26 x 1012 ft3) is correct, the final peak occurred at ~2016 year. The onset of the bust could be extended out to later years by imposing environmental regulations and/or taxes on the extraction of natural gas, thereby reducing the extraction rate.

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## Conclusion

Even for very high estimates of natural-gas reserves for its extraction in Colorado, the current boom will turn into a bust in much less than a decade.

It would be wise for Colorado to use the current natural-gas boom to build the policies and infrastructure for collecting energy from wind and solar, for encouraging drivers to drive electric vehicles and for fast charging stations for electric vehicles in personal and parking garages. Wind energy in Colorado has a good start already.

It would be wise for the govenment of Colorado to do some decade-long planning about how to best manage the coming natural-gas-extraction bust. A tax on natural-gas extraction to put in a fund to help manage the bust and to clean up the mess made by the extraction would be wise. Such tax might have an added benefit of slowing down the extraction so that the bust will not occur so soon, giving more time to prepare for it.

• A similar analysis has been done by the author for crude-oil extraction for North Dakota.
• A similar analysis has been done by the author for crude-oil extraction for Texas.
• A similar analysis has been done by the author for crude-oil extraction for Oklahoma.
• A similar analysis has been done by the author for natural-gas extraction for North Dakota.
• A similar analysis has been done by the author for natural-gas extraction for Pennsylvania.

## References

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L. David Roper, http://arts.bev.net/RoperLDavid/
6 March, 2018