Gas Shortage Fuels Drilling Boom

Natural gas facility.
Wide-open Wyoming has the look of a modern day gold rush, but these days, the gold is natural gas. With prices as high as the Western sky, drilling rigs are popping up all over the plains, CBS News Correspondent Cynthia Bowers reports.

"We have a 30 trillion cubic foot resource right here in the Powder River Basin in Wyoming. This is equivalent to a Prudeau Bay. It's the equivalent of 4 billion barrels of oil," said John Kennedy of Kennedy Oil and Gas.

Those massive reserves trapped in coal beds mean money to producers like John Kennedy, a lot of money. The same gas that sold for $2 last year now nets him $9. And he's not alone — from coast to coast, where there's coal, there's usually methane gas and people drilling for it.

"It's in the ground, it's waiting, it can produced and it can be produced economically," said Lance Cook, a Wyoming state geologist.

Not since the coal boom of the early 1980s has this state seen such frenzied activity. Over the next 10 years, the number of gas wells in the Powder River Basin alone is expect to increase more than tenfold to more than 70,000.

Nationally, the oil and gas exploration industry in this country has added hundreds of jobs in the past year. The number of drilling rigs in use nationally has more than doubled.

Many people worry that not enough attention is being paid to what this might be doing to the environment.

"Enormous quantities of water have to be pumped out to get the gas," said Jill Morrison of the Power River Resource Council.

Up to 100 gallons a minute, 24 hours a day, 365 days a year, have to be taken from each well. It's creating an unheard of problem in some parts of this desert-like land — too much water.

The ecological system in Wyoming developed on a dry 15-inch-a year-rainfall "and it will not stand this kind of water coming all winter long. It's killed a lot of my vegetation and its ruined a lot of my grazing," said rancher Ed Swartz.

Others complain valuable drinking water is being lost, but most everyone agrees America must have access to this resource.

"There's an impact to any source of energy. The issue in my mind comes down to how do you do it right," said Dennis Hemmer, director of the Wyoming Department of Environmental Quality.

But in Wyoming and many other states with the demand for gas so high and so much money to be made, for now the balance may tipped in favor of energy over the environment.