Raton basin coalbed methane production picking up in Colorado

H. Thomas Hemborg
Colorado Geological Survey
Denver

Where Raton Coalbed Methane Production is Growing [72638 bytes]

Coalbed methane production in the Raton basin of south-central Colorado and northeast New Mexico has advanced past pilot testing and is entering into a development stage that should stretch out over several years.

At last count 85 wells were producing nearly 17.5 MMcfd of coalbed methane from the basin's Raton and Vermejo formation coals (Early Paleocene to Latest Maastrichtian). This development work is currently restricted to roughly a 25 mile by 15 mile wide "fairway" centered about 20 miles west of Trinidad, Colo., in the headwater area of the Purgatoire River.

The players

Active producers in the play are currently limited to three companies.

Evergreen Resources Inc., Denver, the play's most active operator, has 33 wells on line producing 10 MMcfd. It plans to have another 21 wells on line by the end of 1996. By yearend Evergreen should be selling 16 MMcfd into Colorado Interstate Gas's Picketwire Lateral, the sole transportation outlet in the Raton area for coalbed methane.

Evergreen has leases covering 120,000 acres in the fairway area, 67,000 of which are in the Spanish Peak Unit operated by Evergreen. All of Evergreen's production now comes from this unit.

Amoco is the smallest producer with approximately 3.5 MMcfd from 27 wells. All Amoco activities lie within its 32,000 acre Cottontail Pass Unit, which is surrounded by the Evergreen acreage spread. Amoco plans to drill and complete five more wells by yearend. Workovers, accompanied by the return of several shut-in wells to production, could bring Amoco's sales volumes to 4.0-4.5 MMcfd in early 1997.

Stroud Oil Properties, a Wichita, Kan., operator that recently bought Meridian's Apache Canyon property, has at least 63,000 net acres in the coalbed methane play. Approximately 25 wells on the Stroud properties collectively are producing 4 MMcfd.

Stroud anticipates placing on production an additional 20 wells in the Apache Canyon area during the rest of 1996. These will be a combination of new wells and shut-in wells that have been worked over.

In addition Stroud will begin producing coalbed methane from vent holes in the underground Golden Eagle coal mine, which was closed and sealed by the mine operator, Basin Resources, in December 1995. The mine, which lies on the northern edge of the current Apache Canyon field boundary, produced coal from the 6-11 ft Maxwell seam in the Raton formation.

If Stroud meets its goal of bringing production up to 8 MMcfd by yearend, the Picketwire Lateral would be carrying 28-28.5 MMcfd out of the Purgatoire area by early 1997.

Geology, water disposal

The depth of the base of the Vermejo formation and the top of the conformable underlying Trinidad sandstone in the Purgatoire "fairway" varies from 550-2,400 ft below ground surface. Over half this difference is not related to subsurface structure but rather to the dissected surface topography caused by downcutting by the Purgatoire River and its tributaries.

Individual coal seams in the Vermejo formation range from several inches to over 14 ft thick, with total thickness in the Purgatoire area ranging from 10-44 ft. Total coal thickness of the Raton formation in the development area averages about 50 ft, with individual seam thicknesses ranging from a few inches to over 11 ft. Individual wells are completed to produce gas from five to 15 individual coal beds.

The play's approved well spacing in Colorado is 160 acres. All three operators estimate the reserve potential in their respective development areas at 1.5-2.0 bcf/well.

Collectively, water production from Raton basin coalbed methane wells now averages a little over 700 bbl/MMcf. Most of the water produced from the dewatering of the Raton basin coals to date has been low in dissolved solids. Evergreen, operating under permits issued by Colorado Department of Public Health and Environment, has been discharging produced water into stream beds and stock ponds. Amoco and Stroud are using injection wells for disposal.

The future

There seems to be sufficient untapped resource in the Purgatoire area to continue building sales volumes on the Picketwire Lateral.

Evergreen believes its acreage position in the Purgatoire area can support 500 wells based on 160 acre spacing. Evergreen's current plans are to drill 40 wells a year on these holdings.

Consolidated Industrial Services (CIS) of Chanute, Kan., is drilling a series of Vermejo and Raton wildcats that have tested commercial quantities of coalbed meth- ane on a recently acquired 23,000-acre block south of coalbed methane production on the Spanish Peak Unit. Projected depths range from 1,000-1,300 ft.

Amoco proved commercial production was possible from the Lorencito Canyon area by conducting a five well pilot program in 1985-87. Lorencito is located between the CIS and the Stroud Apache Canyon holdings. While there is potential for expansion in the Lorencito Canyon area, it is Amoco's intention to concentrate work in the next few years exclusively in the Cottontail Pass Unit.

Stroud plans to fully develop its holdings in the next 2-3 years and should replace Evergreen as the play's most active operator.

By 2000, the coalbed methane picture in the Purgatoire area could look like this:

Evergreen producing 50-60 MMcfd from 200 wells;
Amoco producing 12-15 MMcfd from 60 wells in the Cottontail Pass Unit;
Stroud producing 40-50 MMcfd from 200 wells in the Apache Canyon area; and
CIS producing 10-12 MMcfd from 60 wells.

In this scenario the Purgatoire development area could be producing 112-137 MMcfd in 3-4 years.

Acknowledgments

The author thanks the individual operators who generously contributed information for this Raton basin activity update, particularly Dennis R. Carlton, Evergreen Resources Inc., Mike Korte, Stroud Oil Properties, Alex Woodruff, Colorado Interstate Gas, and Amoco personnel.

The Author

H. Thomas Hemborg is a geologist in the minerals fuel section of the Colorado Geological Survey. Before joining CGS in 1991 he had been active in oil and gas exploration for nearly 20 years with Tenneco Oil Co. He has a BA in geology from Occidental College and an MS in geology from the University of California at Los Angeles.