Marvin Swink, ARCO Oil & Gas Co.
Exploration for natural gas in the Sheep Mountain area, located approximately 28 miles northwest of Walsenburg, Colorado, was begun in early 1972. The first two wells completed produced CO2 instead of natural gas. ARC0 Oil and Gas Company purchased the leases from the original lease holders in 1974 and continued development of the field. The boundaries of the Sheep Mountain Unit were finalized in 1981, and the Unit now consists of approximately 9,000 acres. (See Figure 1.) As a result of this purchase, the Company began making studies and plans on how to produce and deliver the CO2 to various oil fields to be used for enhanced oil recovery (EOR) of the oil remaining in place. It was felt that as much as 25% of the remaining oil in place could be recovered using CO2 for tertiary miscible flooding. The production facilities for CO2 recovery are very similar to those used in the production and recovery of natural gas; therefore, the design and construction of the production facilities were not considered to be a major problem. Since CO2 can be transported by different methods, the Company had to select the most economical method for delivery of the CO2 to the oil fields selected for EOR. Based on the volumes needed for EOR and the production capabilities within the Unit, the Company decided to use a pipeline for the transportation of the 330 MMSCFD that would be produced within the Unit.