methane

Evergreen Resources grabbed another 17,800 acres of coalbed methane properties, representing about 40 Bcf of proven reserves in the southern Colorado portion of the Raton Basin for $19.2 million from Shenandoah Operating Co. The purchase brings Evergreen’s total gross acreage position in the Raton to 265,000 acres.

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.

Evergreen Resources grabbed another 17,800 acres of coalbed methane properties, representing about 40 Bcf of proven reserves in the southern Colorado portion of the Raton Basin for $19.2 million from Shenandoah Operating Co. The purchase brings Evergreen’s total gross acreage position in the Raton to 265,000 acres.

As hoped for by coalbed methane producers operating in the Powder River Basin, Wyoming and Montana regulators have reached a tentative agreement to prevent CBM production from polluting the rivers in the region. Under the tentative proposal announced last week, CBM producers would be allowed to dump discharge water on the ground over an 18-to-24-month period to determine if it actually pollutes the rivers.

As hoped for by coalbed methane producers operating in the Powder River Basin, Wyoming and Montana regulators have reached a tentative agreement to prevent CBM production from polluting the rivers in the region. Under the proposal reached this week, CBM producers would be allowed to dump discharge water on the ground over an 18-to-24-month period to determine if it actually pollutes the rivers.

Despite warnings to companies that it was slowing the process togrant water discharge permits for coalbed methane projects, theWyoming Department of Environmental Quality has issued four waterdischarge permits for Pennaco Energy Co.’s House Creek Project. Allwere approved following a 30-day public notice period.

The gas industry seems more than eager to pipe as much methaneas possible into Florida to satisfy the state’s gluttonous appetitefor gas-fired power generation. Two major Gulf of Mexico pipelinestargeting the state were granted preliminary approval by FERC lastweek, and another two projects were announced, including amid-sized greenfield pipeline planned by El Paso and Enron.

NGI Daily Price Index reported last week that Potomac ElectricPower Co. hoped to sell nearly all of its power generationfacilities — with an estimated capacity of at about 6,055 MW —for an “upside price” of about $3 million. Pepco later correctedthe figure to $3 billion. Pepco further said it hoped to narrow thefield of serious bidders to between six and a dozen by March.

In NGI’s story, “El Paso Pulls Off FTC-Required Sellathon” inthe previous issue (see NGI, Jan. 10), it is erroneously statedthat CMS Energy Corp. purchased both the Sea Robin pipeline and ashare of the Destin Pipeline from El Paso Energy. CMS onlypurchased Sea Robin whereas the Destin Pipeline was sold to anundisclosed party. NGI regrets the error.