CO - OP LIVI NG
Oklahoma Co-ops Face Oil, Gas Boom O
By Victoria Rocha/
ECT.coop
klahoma’s oil and gas boom is doubling and even tripling the loads at some electric co- operatives as they work overtime to satisfy the appetites of an energy-hungry industry. “By all means there’s been a dramatic impact on how we operate,” said David Swank, CEO of Cen- tral Rural Electric Cooperative (CREC) in Stillwater, which projects its load to double during the next several years from companies wanting to drill in its area. “It’s affecting all aspects of system planning and load modeling.”
In Blackwell, tiny Kay Electric Cooperative serves the vast Mississippi Lime oil play, a carbonate for- mation where some of the first horizontal wells sprang up. Many in the energy industry call it the “new Bakken,” referring to the gas- and oil-rich area in western North Dakota undergoing its own boom. “Right now, we’re at 80 megawatts (MW), but that’s probably doubled in the past two years,” said Joe Harris, general manager. “If capacity is available, we could grow to as large as 400 MW in the next two years.”
Co-ops and their power suppliers are under pres- sure to accommodate the load growth quickly. “Producers don’t want to wait because oil is so valuable,” said Mark Faulkenberry, manager of mar- keting and communications at Western Farmers Electric Cooperative, a generation & transmission (G&T) co-op in Anadarko.
Thanks to improved drilling techniques, oil and gas companies are seeing quicker payoffs. Co-ops are under a crunch to build new substations and add lines to handle the demand.
Swank said systems are not meant to handle the rush of producers and demands. In other cases, some oil companies have built their distribution lines to handle the load.
“This has relieved a great deal of the workload associated with serving the new loads,” said Colin Whitley, CEO and general manager of Alfalfa Elec- tric Cooperative in Cherokee. The co-op’s sales have grown by nearly 115 percent over the past fi ve years, and are up more than 33 percent this year compared to last.
Kay Electric has requests for seven new substa- tions and upgrades for seven more.
“They’re fast movers,” general manager Harris said of the oil producers. “They’re not good at giv- ing any warning.”
With their power suppliers, co-ops are working on both short- and long-term plans to serve future growth, said Western Farmers’ Faulkenberry. The G&T is taking different approaches to resolve capacity issues, including securing a short-term power purchase agreement from an independent power producer, working with regional transmis- sion operator Southwest Power Pool and using dis- tributed generation.
CREC has added 15-20 oil producers to its load in recent years. It’s hiring extra contract crews for construction and system improvements, to meet producers’ needs “as soon as possible,” Swank said. One of those producers, SandRidge Energy, works
with co-ops to balance the need for power at peak times to alleviate strain on the grid.
While Oklahoma’s oil and gas boom has brought growing pains for co-ops, it’s also brought gains to areas that have fallen on hard times.
One, Two, Three... GO! Celebratory Press Start at QuadGraphics Photo by Austin Partida/Kay Electric
Kay Electric Cooperative provides electric- ity for this oil pump jack located west of Blackwell, Okla.
“The growth of this industry has had a big impact on the creation of jobs, and the production has pro- vided royalties to the local landowners,” said Kay Electric’s Harris, who noted another benefi t. “It’s important for national security, because
domestic oil means we won’t be as dependent on foreign oil.” OL
Courtesy Photo
Sid Sperry, the Oklahoma Association of Electric Cooperatives’ director of com- munications (left) and Governor Mary Fallin (right) hit the press start button at the QuadGraphics Oklahoma City printing plant last month. The ceremony marked the new offset press that prints Oklahoma Living, and Quad’s 10th Anniversary in the OKC plant, which has brought hundreds of job opportunties to Oklahomans.
NOVEMBER 2012 5
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