MT. PLEASANT, Mich., Feb. 7, 2003 (PRIMEZONE) -- Gastar Exploration, Ltd. (TSE Venture Exchange:YGA) is pleased to provide the following operational update:
Powder River Basin, Wyoming
Gastar owns an approximate 72% working interest in 61,101 grossacres and, along with its affiliates, controls 42,801 net acres in the development fairway of the Powder River Basin. Gastar has participated in the drilling of over 190 CBM wells in the basin. Currently, 91 of the wells are in the initial phases of production and producing approximately 4,200 Mcfd gross and 1,500 Mcfd net of natural gas to Gastar's interest.
Gastar is currently planning a program of re-completions, enhancements, re-activations and pump upgrades on a number of its wells in the Squaw Creek area. In addition, Gastar is planning for the drilling of up to an additional 100 CBM locations in the Squaw Creek area as well as on acreage recently acquired through acreage trades. In order to more efficiently manage these remedial activities as well as the new drilling, Gastar has entered into an interim consulting agreement with CBM International Engineering (www.cbm-engineering.com) to manage its Squaw Creek assets as well as evaluate all of Gastar's Powder River Basin assets for future development. Based on satisfactory results from CBM International Engineering's efforts, Gastar anticipates that a longer-term and more encompassing consulting arrangement will be entered into between Gastar and CBM International Engineering.
Gastar's Chief Operating Officer, J. Russell Porter, commented, "We believe that the merger of Gastar's business talents and acreage position with CBM International's operational expertise and focus will yield better results for Gastar through higher production volumes, lower operating costs and, ultimately, lower development costs. CBM International Engineering's principals have extensive experience in the Powder River, San Juan, Green River and Uinta Basins. In the Powder River Basin, they have overseen the planning, drilling, completion and production of over 2,100 CBM wells for Pennaco and Marathon. CBM International will be evaluating the latest development techniques for Gastar's properties including the potential for commingling production from multiple coal seams in single wellbores to reduce the investment necessary to access CBM reserves. We believe that it was wise to drastically lower our level of investment and activity during the first nine months of 2002 as gas prices in the PRB were too low to justify additional capital investment. However, with gas markets in the Rockies, and the rest of the United States, recovering as a result of weather-driven demand and lower production levels, we believe that current and future gas prices justify continued investment in the area."
Gastar Exploration is an exploration and production company focused on finding and developing natural gas in North America and Australia. The Company pursues a balanced strategy combining low-risk CBM development with select higher risk, deep natural gas exploration prospects. Gastar's CBM activities are conducted within the Powder River Basin of Wyoming and upon the approximate 4 million acres controlled by Gastar in Australia's Gunnedah and Gippsland Basins located in New South Wales and Victoria respectively. The Company owns prospective acreage in the Bossier Sand gas play of East Texas, in the deep Trenton - Black River play of Appalachia and in the deep Temblor gas play in the East Lost Hills field within the San Joaquin Basin of California.
CBM International Engineering, LLC is a Wyoming-based business that specializes in developing coal seam natural gas for E&P companies worldwide.
This Press Release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. Although Gastar believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals and assumptions will be achieved. Important factors that could cause actual results to differ materially from those in the forward-looking statements contained herein, include, among others, the success and timing of certain projects, the success in drilling and producing oil and gas properties, changes in commodity prices for oil and natural gas, operating risks, the uncertainty associated with estimating underground quantities of crude oil and natural gas reserves and other risk factors as described in the Company's Annual Information Form filed as of May 2002, on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.