Overview

Resources and Consumption

Arkansas has moderate energy resources. Substantial natural gas reserves are found in the Arkoma basin in western Arkansas and in the Gulf Coastal Plain in the south. Smaller oil reserves and coal deposits are also found in those regions. Several river basins, including the Lower Arkansas River, offer hydroelectric power potential. Areas of the State are also suitable for wind, wood, and wood waste power generation. Per capita energy use is high due in part to an energy-intensive industrial sector, which leads State energy consumption.

Petroleum

Arkansas extracts small amounts of crude oil mostly from stripper wells (wells that produce less than 10 barrels per day) in the southern part of the Gulf Coastal Plain of south Arkansas. Arkansas has two refineries located in the same region. Petroleum products are delivered to consuming regions by barge via the Arkansas and Mississippi Rivers. The TEPPCO pipeline also supplies petroleum products from Texas and Louisiana. Arkansas is one of the few States in the Nation that allow the statewide use of conventional motor gasoline. (Most States require the use of special fuel blends in non-attainment areas due to air-quality considerations.)

Natural Gas

Arkansas natural gas production typically accounts for about 1 percent of annual U.S. output. Most of the State’s natural gas production takes place in the Arkoma basin, although several wells also operate in the Gulf Costal Plain. In addition to conventional production, small amounts of natural gas have been extracted from coalbed methane deposits in the Arkoma basin since 2001, with a cumulative production of about 10 Bcf.

Several major natural gas pipelines from Texas, Louisiana, and Oklahoma pass through the State on the way to markets in the Midwest and Northeast. In addition, two new pipeline projects will soon be able to transport gas extracted from newly productive wells in Texas, Louisiana, and Arkansas. The recently completed 500-mile Midcontinent Express Pipeline passes through Texas and Arkansas, and the 187-mile Fayetteville Express Pipeline passes through Arkansas and is expected to be complete in late 2010 or early 2011.

Although it is still the leading sector in the State, the Arkansas industrial sector’s natural gas consumption has declined in recent years. Until 2001, the industrial sector accounted for more than one-half of the State’s natural gas consumption but this share had fallen to two-fifths by 2007. Almost one-half of Arkansas households use natural gas as their primary energy source for home heating.

Coal, Electricity, and Renewables

Coal and nuclear power are the dominant energy sources used for electricity generation in Arkansas, although natural gas and hydroelectric power are also important. Coal-fired power plants account for about one-half of the electricity produced within the State, and these plants rely entirely on coal deliveries from Wyoming. The State’s only nuclear plant, the dual-unit Arkansas Nuclear One Plant in Russellville, typically generates more than one-fourth of the total electricity generated in the State. Hydroelectric power plants in the White River Basin in the north, along the Arkansas River in central Arkansas, and in the Ouachita River Basin in the south also contribute to electricity supply. About one-third of Arkansas households use electricity as their primary energy source for home heating. Arkansas has adopted several policies to encourage renewable energy and energy efficiency including green building standards for State facilities.