Evergreen acquires additional Raton Basin interests

Petroleum News Alaska

Evergreen Resources Inc. said July 19 that it has acquired additional working interests in approximately 17,800 acres of producing coalbed methane properties in the southern Colorado portion of the Raton Basin. The acquired working interests average 35 percent, bringing Evergreen’s average working interest in these properties to approximately 80 percent.

Evergreen said the interests were purchased for approximately $19.2 million in cash from a private exploration and production company.

The property acquisition brings Evergreen’s total gross acreage position in the Raton Basin to approximately 265,000 acres.

The acquired property interests represent an estimated 40 billion cubic feet of proven net gas reserves which are currently generating daily net gas sales of about 2.5 million cubic feet from 65 producing wells. Prior to the acquisition, Evergreen’s daily net gas sales were averaging approximately 80 MMcf from about 560 net producing wells.

Evergreen President and CEO Mark Sexton said the company already produces more than 75 percent of the natural gas from the Raton Basin.

“We see numerous opportunities to increase production from this area by focusing on re-completions and workovers to existing wells. The average well in this area is producing substantially below the average Evergreen-operated well in the Basin,” Sexton said.

Evergreen said it has drilled 84 wells in the Raton Basin in 2001 and is on track to meet its expanded goal of drilling 130 to 140 wells in the basin this year.