A partner of Houston-based Alta Mesa Holdings is starting to drill two new natural gas wells in western Idaho and is seeking permits to construct a 10-mile gas pipeline that would connect new and existing wells to a pipeline connecting a major gas-fired power plant near New Plymouth, ID.

Alta Mesa partner Snake River Oil and Gas owns existing wells drilled originally in the Willow Hamilton fields in Payette County by Bridge Resources. Snake River and Alta Mesa have sold more than 100,000 acres of gas leases in the area, according to the Idaho Petroleum Council (IPC).

Although generating some excitement in Idaho, which is the newest state to uncover gas deposits, the overall play is still very small, including 11 wells so far, according to a spokesperson for Snake River Oil and Gas.

IPC Executive Director Suzanne Budge has told local news media that there could be new gas supplies for local consumers later this year. In June, the Idaho Department of Lands approved two separate permits for Alta Mesa Services to drill in the area where three years ago Bridge Resources discovered gas and condensate.

Condensate is what makes the play pencil out, according to Budge. Earlier this year, condensate captured during testing was sold to a Salt Lake City refinery, she said.

So far, local landowners are pleased with the lease sales and the prospects for earning substantial royalties, according to the IPC.

Budge has stressed to local news media that no hydraulic fracturing (fracking) will be used in the play, which is sedimentary sand deposits, not shale. Drillers will use well treatment, a time-tested process sending liquids and sand down wells under high pressure to enhance the flow of gas, she said.

Last year, the Idaho state legislature passed a new oil/gas exploration and production law (see Daily GPI, Feb. 1, 2012), and this year it changed the composition of the Idaho Oil and Gas Commission, which is overseen by the Idaho Land Board.

Gov. Butch Otter earlier in July approved the new members of the oil/gas commission to include different stakeholders other than members of the land board.

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