From The Denver Post (Bruce Finley):
The Northern Water Conservancy District runs the auction, offering excess water diverted from the Colorado River Basin — 25,000 acre-feet so far this year — and conveyed through a 13-mile tunnel under the Continental Divide. A growing portion of that water now will be pumped thousands of feet underground at well sites to coax out oil and gas.
State officials charged with promoting and regulating the energy industry estimated that fracking required about 13,900 acre-feet in 2010. That’s a small share of the total water consumed in Colorado, about 0.08 percent. However, this fast-growing share already exceeds the amount that the ski industry draws from mountain rivers for making artificial snow. Each oil or gas well drilled requires 500,000 to 5 million gallons of water. A Colorado Oil and Gas Conservation Commission report projected water needs for fracking will increase to 18,700 acre-feet a year by 2015…
Riding his tractor this week, Colorado hay producer Lar Voss, who bid for water at the recent auction, accepted this approach. Voss bid for 100 acre-feet “to be sure I’ve got enough for the crops,” he said. Selling water to those who can pay the most “is what ought to happen.”[…]
At the recent auction, Fort Lupton-based A & W Water Service Inc. bid successfully for 1,500 acre-feet of water, paying about $35 per acre- foot. That’s slightly higher than the market price that irrigators pay for leasing water along the Front Range. The average price paid for water at NWCD’s auctions has increased from around $22 an acre-foot in 2010 to $28 this year.
A & W also leases water from Longmont, Loveland, Greeley and other cities — and hauls it to drilling sites.
More Colorado-Big Thompson Project coverage here.