By OGJ editors
HOUSTON, Aug. 7 -- Penn Virginia Corp., Radnor, Pa., and CDX Gas LLC, Dallas, will explore for and develop coalbed methane and Devonian shale on a 16,000 sq mile area of mutual interest in an unspecified area or areas of Central Appalachia.
This is an area two-thirds the size of the state of West Virginia.
Penn Virginia said the program combines its proven CBM operating capability with the exclusive use of CDX-developed proprietary horizontal drilling technology. The 5-year agreement permits either party to propose wells. Working interests will be PVA 60% and CDX 40%. Penn Virginia will become operator when a successful project goes on production.
On future AMI projects conducted on property not currently owned by Penn Virginia, 50-50 working interest will generally apply.
A horizontal well drilled in late 2001 with CDX continues at 2.9 MMcfd of CBM. Vertical Appalachian CBM wells typically flow 50-100 Mcfd. The first offset pattern to this well is being drilled. At least one other pattern is planned this year.
CDX and affiliates are developing CBM projects in nine states and two Canadian provinces.