the australian today

Gas find in the Appalachians

ALMOST two years ago, the then Alto Energy International, now Grand Gulf Energy (GGE), decided to move out of high-cost gas exploration in the Appalachians to easier, lower-capital targets in Louisiana, and has gone on to make considerable progress there.

But Bob Berven feels they may have walked away too soon and that much higher natural gas prices make Appalachian exploration more attractive these days. In fact, his Emerald Oil & Gas (EMR) has wound back its prospects -- one left in Texas, another in North Dakota -- and is in hot pursuit of gas in Kentucky and West Virginia.

The company, which listed two years ago next month, is now about to get its first sustained income stream. Emerald's first gas well in the Appalachians has been completed and hooked up to production equipment and, when the hydrogen sulphide content is stripped out, will be connected to a local pipeline.

The company expects the well to flow at up to 400,000 cubic feet a day and, with gas fetching a high $US11.50 per 1000 cubic feet, that's something you can take to the bank.