Cooperation may be essential for oil development

A problem in the area is that electric cooperatives and pipeline companies are reluctant to spend millions of dollars on infrastructure when they don't know how many wells are planned or where they will be located.

“These operators need to talk to their neighbors and say, ‘I'm drilling 10 acres here and you're drilling six acres there, so let's go in together,” said Slawson, vice president of Slawson Exploration. “But the operators still aren't talking to each other. The operators need to communicate with each other and with the co-ops.”

To address the power shortage, many cooperatives are asking producers to build their own distribution lines and substations, which would add many millions of dollars to the companies' drilling costs.

Again, cooperation appears to be best answer.

“What we're going to have to see is more dialogue and collaboration among these various producers, both big and small,” Murphy said. “It could be that a bigger company could build part of the distribution and substation and allow space for more to be added by the smaller producers. I think you're going to have to see a collaborative effort.”