CONSOL acquires Virginia coalbed methane assets
CONSOL Energy Inc., Pittsburgh, Pa., signed a letter of intent to acquire Conoco Inc.'s interests in some coalbed methane gas production and gas-gathering pipelines in southwestern Virginia. The value of the deal was not disclosed.
By the OGJ Online Staff
HOUSTON, Aug. 9 -- CONSOL Energy Inc., Pittsburgh, Pa., signed a letter of intent to acquire Conoco Inc.'s interests in some coalbed methane gas production and gas-gathering pipelines in southwestern Virginia.
The transaction, which is subject to definitive agreements and director approval from both companies, would increase CONSOL Energy's proved gas reserves to more than 1 tcf, said company officials. The value of the pending deal was not disclosed.
Under the proposed deal, CONSOL will acquire Conoco's 50% interest in the jointly-owned Pocahontas Gas Partnership and its 25% interest in Cardinal States Gathering Co. CONSOL will be sole owner of both operations when the transaction is concluded.
PGP produces 54 MMcfd of pipeline quality methane gas. CONSOL Energy's subsidiaries currently operate the wells and the mines from which the gas is extracted.
PGP has proved developed and undeveloped coalbed methane gas reserves estimated at some 740 bcf.
CSGC operates two gathering pipelines with a combined length of 80 miles that connect to the Columbia Transmission System.
Subsidiaries of RWE-DEA AG own 94% of CONSOL Energy, and DuPont Energy owns 6%. DuPont's interest was held through Conoco prior to its spinoff of that Houston-based oil company.