Overseas drill rigs head for the West

 

Oil and gas drilling permits have tripled during the last five years, and every available rig has been pressed into service. Now, energy companies are looking overseas, particularly to China, for equipment and qualified crews. But as foreign drill rigs and workers arrive to tap Western lands, political red flags are starting to go up.

The region already hosts drilling equipment from Italy, China and Canada, and the Oil and Gas Journal reports 850 new rigs are needed nationwide over the next five years. "We’ve under-invested in the exploration field for years," says Bill Croyle of Western Energy Advisors, which secured a deal begun two years ago between China National Petroleum Corporation and a private group of American investors. The company they formed, Golden Bear, will import Chinese rigs and crews to help ease the equipment and labor shortage.

But foreign labor rankles some, including Rep. John Salazar, D-Colo., who is concerned that locals are being skipped over for good jobs. "We need to keep American jobs in America," says Nayyera Haq, a spokesperson for the congressman. "We shouldn’t outsource jobs on our own soil."

In August, the first Chinese rig began drilling in Colorado’s Garfield County, and another 10 rigs are expected in the state this fall. But there’s plenty of work to go around, so no one in the industry is worried about losing their job, according to Doug Dennison, Garfield County oil and gas liaison (HCN, 8/8/05: Industry embeds its own in the BLM). So far, he says, he’s heard more locals grumbling about "pickups with Wyoming and Utah plates than ... about Chinese crews."