Calgary-based AltaGas is acquiring a 90% working interest in the 30 MMcf/d Cygnet-Prevo natural gas plant and associated 100-kilometer gathering system located near Red Deer, AB. Current throughput at the plant is 18 MMcf/d, and the facilities will be operated as part of AltaGas' existing Bonnie Glen complex. With the acquisition and current activities, the midstream independent's total gross processing capability in the Bonnie Glen area will be 80 MMcf/d. Closing is expected before July 31. According to the company, the Cygnet-Prevo system lies in a successful multi-zone producing region of the Western Canadian Sedimentary Basin. The gathering system encompasses about nine townships (83,915 square hectares), making it "well positioned to capture additional development in this area."
PanCanadian Petroleum Ltd. and MGV Energy Inc., the Canadian subsidiary of Quicksilver Resources Inc., are formalizing their coalbed methane (CBM) joint venture by drilling their first pilot wells beginning this fall in the largest Canadian CBM project to date. So far, the companies have drilled 21 exploration wells and plan to drill another 29 more in a region of southern Alberta, focusing initially on a million-acre tract in the Palliser block. Because of their exploratory success to date, the companies, which began their CBM joint venture last November (see NGI, Nov. 6, 2000), also doubled their capital spending this week, earmarking more than C$30 million, up from C$15 million. PanCanadian said the pilot wells follow a common method to extract CBM, and will drill a group of wells near the exploratory wells that appear promising. Asked if the exploratory success so far could draw a parallel to CBM success in Wyoming's prolific Powder River Basin, Quicksilver CEO Thomas Darden told NGI that the Alberta acreage, 100% owned by PanCanadian, was "a bigger playground, but we don't know at this point if it will be as productive." He said the companies had "high hopes that what we are seeing has wide applicability because so far, the results have been very encouraging." Once the pilot phase begins, Darden said the companies would expand their focus and begin exploratory drilling outside the Palliser block.
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