By Ian Gilson, PhD, CFA
New Western Energy Corporation's (NWTR) Anna #1 well was drilled to 1,793 ft. and the presence of coal gas was confirmed. Structures similar to those found whilst drilling Magnus #1 encountered several zones in the Mississippi Dolomite formation that held coal gas in sufficient quantities to be produced at a profit.
The two wells suggest that there is a significant reservoir of coal gas below the property. The extent of the reservoir will be further determined by the drilling of a third well at the north east section of the property. The results from the third well should allow New Western Energy to determine the available reserves and the quality of the gas (which could contain water, carbon dioxide, sulfur and possibly gas liquids like ethane and propane).
If the quantity of gas is sufficient the company will construct a gas gathering pipeline to connect the field to the nearest sales point. The cost of acquiring the right of way and the construction of a gas gathering system should not exceed $0.2 million.
A copy of the full research report can be downloaded here >> New Western Energy Report
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