Texaco Inc. said Tuesday it has purchased coalbed methane gas properties in the San Juan basin of southwestern Colorado and northwestern New Mexico for $121 million.
It bought the properties from EnerVest Management Partners Ltd., Houston, and from GE Capital Oil & Gas, effective last Nov.1.
The assets include proven reserves of 204 bcf, of which 53% are undeveloped. Net production was 21.5 MMcfd with anticipated growth to 38 MMcfd within 3 years.
Alan Kleier, Vice President for Texaco Exploration and Production Inc.'s Central US Business Unit, said, "The assets acquired through the EnerVest San Juan purchase are highly complementary to our existing San Juan Basin coalbed methane business. This acquisition will enable us to build value through additional drilling, workovers, and increased production, as well as capitalize on operating synergies with our existing properties."
Texaco operates San Juan basin wells near the acquired properties. Prior to the purchase, Texaco produced 104 MMcfgd in the area.
It said restimulation and infill drilling over the last 3 years have doubled its gas production in the area while significantly reducing operating costs.
