Utah is home to vast reserves of coal, oil, and natural gas including:
- 555 million barrels of crude oil (1.5% of U.S. share)
- 6,685 billion cubic feet of dry natural gas (1.8%)
- 206 million barrels of expected future production of natural gas plant liquids (1.4%)
- 97 million short tons of recoverable coal (0.5%)
According to the Fraser Institute’s 10th annual survey, Utah ranks as the 9th most attractive jurisdiction for upstream petroleum investment. Utah’s oil and gas industry, (extraction, refining, distribution, and sales), provides more than 7,000 direct, high-paying jobs in Utah, while the coal industry provides more than 1,500 (as of 2015). In 2013, oil and gas contributed $5.2 billion to Utah’s economy, while coal accounted for $887 million.
- Utah ranks 14th in coal production, 11th in oil, and 10th natural gas production (2015)
- Utah has approximately 4,591 producing oil wells and 7,099 producing natural gas wells (2015)
- About one-fourth of Utah’s total crude oil production came from tribal lands (2013)
- In 2014, 11.9 million short tons of coal was used locally, 3.4 million st was shipped to other states, and 2.5 million st was shipped overseas
Affordable and reliable energy, largely supplied by Utah’s low-sulfur, high BTU coal, plays a crucial role in Utah’s successful economic formula. Mined throughout Utah for more than 100 years, roughly 75 of the electricity generated in Utah comes from coal. In 2015, for example, 14.5 million tons of coal was produced in Utah, valued at $520 million. Utah’s coal economy is especially important to rural Utah, providing roughly 2,000 direct high-paying jobs, and a significant portion of several rural counties tax base – including Sevier, Emery and Carbon counties.
The majority of Utah’s power is produced from the state’s five highly efficient power plants, namely Intermountain Power Plant (1,800 MW), Hunter (1,427 MW), Huntington (996 MW), Sunnyside (58 MW), and Bonanza (500 MW – located on Indian Country, under federal jurisdiction).
Utah is also leading the way on several advanced coal innovations including carbon capture, oxy-firing, gasification and coal to liquid technologies. The state is also home to the University of Utah’s nationally recognized Institute for Clean and Secure Energy, which boasts a premier coal combustion and gasification lab.
The natural gas industry continues to thrive in Utah. Historically, coal has dominated Utah’s energy scene, but starting in 2010, natural gas became the primary energy production source. By 2014, increased activity in the Uinta Basin boosted production levels to record highs at 491 billion cubic feet (however, due to market swings, production declined to 423 bcf in 2015). Utah currently ranks 10th in the U.S. for natural gas production (2013), and holds roughly two percent of the nation’s reserves supply.
Produced through conventional wells and coalbed methane, Utah’s natural gas in 2015 comprised 42 percent of the energy produced in the state, and 26 percent of the energy consumed. Roughly 16 percent was exported to surrounding states.
Utah is crossed by one of the transportation corridors for shipping natural gas to markets in Nevada, Wyoming and Idaho. The Clay Basin facility on the Utah-Wyoming border near Colorado is one of the region’s largest underground storage facilities. More storage capacity is being developed in a salt formation in western Utah to provide market storage services on the interstate pipelines for Wyoming’s natural gas Opal Hub.
Utah’s rich history as a major oil producer dates back to 1955, with the discovery of Bluebell field in Duchesne County. More than six decades later, the state ranks as the 11th largest oil producer in the United States. Utah’s 504 million barrels of reserves is estimated to last roughly 20 more years, ensuring the state remains a significant oil producer for years to come.
Through the years, Utah has undergone three oil booms, and is currently defining a fourth. The commodity made the largest contribution to Utah’s fuel production in 2014, with nearly 41 million barrels ($2.8 billion). With the drop in oil prices in 2015, production dipped 9.6 percent to 37 million barrels ($1.3 billion). In 2015, crude oil made up approximately 21 percent of the energy produced in Utah, and accounted for 33 percent of the total energy consumed by Utahns.
The majority of Utah’s oil production is concentrated in Duchesne, Uintah and San Juan counties. The oil is commonly referred to as “waxy crude” given its relatively high paraffin content. Utah’s two types, black and yellow, flow like a liquid at high temperature, but turn to the consistency of shoe polish at room temperature, creating long-distance transportation challenges. However, their unique makeup has very low levels of acid, sulfur and metals, which make them desirable to refineries because they require less processing.
The state’s five refineries, located in the Salt Lake City area, process crude oil brought in by pipeline from Utah, Wyoming, Colorado, and Canada. The refineries, which produce motor gasoline, diesel fuel, jet fuel, other fuel oils, and wax, represent more than one-fourth of the refining capacity in Petroleum Administration for Defense District (PADD).
In late 2015, Utah’s land-grant research institution, Utah State University (USU), released the Regulatory Road Map for Oil and Gas Exploration, Development, and Production in Utah. The resource guide provides industry stakeholders with an overview of oil and gas regulations throughout the state.