Saturday, May 24, 2008

Navajo Nation Oil & Gas Co. looking for new resources

The Navajo Nation Oil & Gas Company (NNOGC) is blazing a new trail as an integrated oil company, along the lines of many national oil companies. NNOGC is 100% owned by the Navajo Nation and works on their behalf. They own and operate producing wells, explore for new fields, run pipelines, operate gas stations, and are looking at opportunities both on and off reservation lands.

I spent a few hours on Thursday with CEO & President Wilson Groen, geologist Stephen Hines, geophysicist Mustapha M'Rah, and engineer Chalmers Bitsoi.

NNOGC moved into their new headquarters in Window Rock, in December 2005, after working out of a couple of motel rooms. Today, they have about 30 staff plus another 70 or so in gas stations.

The company manages oil and gas resources for the Navajo Nation. In the past, that mostly meant leasing the Nation's lands and collecting royalties. Today, the company is an active partner in fields, is taking over full operation of fields as old agreements expire, is carrying out an aggressive exploration program, and undertaking a comprehensive resource assessment of tribal lands. Tribal production increased 45% in 2007 to 2122 BOPD and proven oil reserves increased 150% to 28.8 million barrels. The company's financial results are equally or more impressive: revenues up 51%, operating income up 112%, net income increased an astounding 994%, with net assets up 66% and total assets up 155%. The results for FY2008 are being reviewed now and should be available soon.

Most of the Nation's oil and gas resources are in Utah and Colorado. NNOGC has a 25% in the giant Aneth field in the Paradox basin. Parts of it have been successfully flooded with CO2 in an enhanced oil recovery operation. A full field enhancement program is expected to cost $750 million.

The company has a block of land covering about 5 townships on the western side of New Mexico's San Juan basin that is prospective for coalbed methane.

The company recently shot 3-D seismic over the Canal Creek acreage block and drilled two wildcat exploratory wells. They are focused on tribal lands but have the authority to go anywhere in the world.

Looking at the tribes lands, it's clear that the Arizona part is under-explored. The Arizona oil fields agreement ends in 2012 and NNOGC already has plans once they assume control.


  1. Arizona is loaded with oil, manganese and other natural resources. When word gets out, those who opened grape vineyards and nut trees on their Arizona property will have struck gold literally....

    1. Exactly, Julie... But it will take a new Governor in our great state to make this work.

      I expect that man to be me.
      John Lewis Mealer