Evergreen acquires 113,000 acres and 12 wells in Kansas

Denver-based Evergreen Resources Inc. said Sept. 15 that it has acquired a 100 percent working interest in 113,000 acres of prospective coalbed methane acreage in eastern Kansas for $10.2 million in cash from a privately held Midland, Texas-based oil and gas company.

The company said that this acquisition, along with several smaller property transactions, gives it a 100 percent working interest in more than 650,000 acres in eastern Kansas.

The acquired properties, located primarily in Atchison County, Kansas, include a 12-well pilot project with a gas gathering system and associated production equipment. The wells, which were not fracture stimulated, are in various stages of dewatering and are not producing commercial volumes of gas. A portion of the acquisition cost was allocated to the pilot project.

Evergreen said it plans to drill seven four-well coalbed methane pilot projects (with an additional water injection well for each pilot), plus five stratigraphic core wells in eastern Kansas beginning in October. The company also plans to begin fracture stimulation operations on the 12 newly acquired wells within the next few months.

"With this property acquisition, Evergreen has become one of the largest leaseholders in eastern Kansas," Evergreen President and CEO Mark Sexton said in a statement. Sexton said Evergreen will begin operations in October, "and, by year-end, we expect to have sufficient data from our initial drilling phase to accelerate plans for additional pilot projects and expected development drilling in 2004."