Anadarko Petroleum Corp. is doubling up its Rocky Mountainexploration and production presence this year, announcing yesterday itwould budget more than $131 million toward an aggressive strategy tofind and develop new natural gas and coalbed methane sourcesthere. E&P will target some of the nearly eight million acrespicked up in the Union Pacific Resources merger last year (see DailyGPI, July 17, 2000).

With plans to drill more than 20 new exploratory and 130development wells in Wyoming, Colorado and Utah, the company alsowill participate in 275-plus wells operated by other companies andconduct 3D seismic studies of more than 500 square miles.

“Because of the large acreage position that we hold in theregion, Anadarko has certain economic advantages that can’t bematched by our competitors,” said COO John N. Seitz. He said thecompany would “deploy more resources” in the region because itviews the Rockies “as one of the richest areas capable of providingnew natural gas supplies for the U.S.”

In its claim as the most active driller in North America, theHouston-based producer said it would be a “significant player infuture drilling in the Rockies,” where the National PetroleumCouncil estimates there is 388 Tcf of remaining recoverablereserves.

Coalbed methane production is the target in Utah and Wyoming,with the Helper and Drunkard’s Wash fields in Utah banked with morethan $20 million alone for E&P. Anadarko drilled 52 wells inthe area last year, ramping up average daily production from thetwo fields there to 20 MMcf/d from 10 MMcf/d. By the end of thisyear, an additional 37 wells are expected to raise production tomore than 40 MMcf/d, with further peaks realized in 2002.

Wyoming’s coalbed methane reserves are part of seven differentprojects by Anadarko. In the Powder River Basin, 35 net wells willbe added to the two drilled there last year, and capital spendingis expected to top $10 million.

“We consider gas production from coalbed methane an increasinglyimportant core play,” said Seitz, but because the projects arecomplex, he expects it would take two years before productionbegins.

Conventional natural gas plays are the focus of three projectsin Utah and Wyoming: the Greater Green River Basin, the Paleozoicreservoirs and the Overthrust/Subthrust plays. Here, Anadarko willspend $11.5 million on drilling and new lease acquisitions.

“Big discoveries were made in these plays 20 years ago using 2Dseismic,” said Seitz. This year, he said, the better 3D technologywill “yield another round of success in the region.”

In Wyoming’s Greater Wamsutter field, 60 net wells are scheduledthis year, and capital spending will double to more than $35million. Production is expected to increase to 84 MMcf/d. Lastyear, Anadarko drilled 32 conventional gas wells there thatproduced an average 75 MMcf/d.

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