Garden Gulch attracts Denver gas company
A Denver company has acquired an interest in a natural gas venture northwest of Parachute that could result in about 600 wells being drilled below 6,300 acres of ranchland.Teton Petroleum Co.’s stock rose about 50 percent, to $2.40 per share, after its announcement Wednesday that it has bought a quarter interest in Piceance Gas Resources LLC.Piceance Gas Resources LLC owns the rights to drill in the Garden Gulch area. It’s on acreage just northwest of the Grand Valley field of the Piceance Basin, a gas-rich region that includes much of western Garfield County.Teton Petroleum bought its interest from PGR Partners LLC, another Denver company, for $5.25 million in cash and 450,000 unregistered shares of Teton common stock. Teton also gave PGR options to buy 200,000 more shares of stock at $2 per share within the next five years.Howard Cooper, Teton Petroleum’s founder, said Piceance Gas Resources hopes to drill eight to 12 wells this year, and increase drilling after that.”We like the area. We think it’s an excellent area to be in,” Cooper said.He is encouraged by the proximity of Piceance Gas Resources’ interest to the Grand Valley field, which has produced more than 210 billion cubic feet of natural gas – more than $1 billion worth.”It’s a good play over there. We like it. We like the reserves, we like the spacing,” he said.Developers of the Grand Valley field are drilling wells at a density of one per 10 acres, Cooper said. Williams Production is reporting that the gas produced is expected to reach 1.2 billion cubic feet per well, or more than $6 million in gas at today’s prices, Cooper said.”If you’re paying $1.6 million to drill and it produces $6 million, it’s pretty good,” he said.Cooper said Teton Petroleum likes the location of Piceance Gas Resources’ gas interests because it is sparsely developed ranching country, and the owners of the surface and mineral rights are the same, so they don’t have a problem with the drilling plans.”We think it’s a good opportunity. We also are very conscientious of the surface and are going to be very careful out there,” he said.He said he knows gas development is a sensitive subject in parts of the county.”We chose to be in an area that had good reserves but also did not have golf courses, housing developments, things like that. We understand that’s a big issue over there.”Cooper is a native Coloradan who has worked in gas development in the Rocky Mountains and overseas. He said PGR Partners was formed by former executives of McMurray Energy Co., who developed the Jonah gas field in Wyoming.Contact Dennis Webb: 945-8515, ext. email@example.com
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