Gastar Exploration Ltd. has acquired, in arms-length transactions, a 75% working interest in about 4,000 net acres of leases in Campbell County, WY, as well as 11 pilot test wells and other acreage in the Appalachian Basin. The Wyoming acreage, located in the Squaw Creek area, is part of the Powder River Basin, which is rich in coalbed methane (CBM) deposits. It already has 65 CBM wells in the initial stages of dewatering and production, with several realized production rates approaching 75 Mcf/d after less than two months of dewatering. No financial details were disclosed for either deal.

The Appalachian Basin acquisition is located in West Virginia and Pennsylvania. Interests acquired equal up to a 75% working interest in 11 pilot test wells, 200,000 acres of undeveloped leases, and existing and newly acquired proprietary 2-D seismic data totaling nearly 300 miles. The pilot test wells have recently been drilled and are in the initial stages of production start-up.

Gastar’s Powder River acreage is currently being developed with two drilling rigs, and the Mount Pleasant, MI, company said it expects to drill another 40 wells in the area through 2001. The company also is in various stages of due diligence to acquire additional interests in the project area, it said.

As part of its long-term strategy, Gastar also has entered into a long-term gathering and marketing agreement with an undisclosed major natural gas transportation and marketing company to provide Gastar with markets for all volumes projected to be produced from the Squaw Creek area. The agreement calls for approximately 500 Mcf/d of gas transportation capacity to be available immediately, with an additional capacity of 3.7 MMcf/d by the end of the first quarter of 2002. The agreement also calls for the ability to increase gas volumes in increments of 4.5 MMcf/d as required by Gastar.

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