A new coalbed-methane (CBM) play is energizing the Forest City Basin in northeastern Kansas. Companies are leasing land and starting pilot programs in the farming and ranching country around Topeka. Multiple thin, shallow Pennsylvanian coal seams in the Cherokee Group are the focus of their efforts. Kansas is no stranger to CBM, as operators in the southeastern part of the state already produce from coal seams in the Cherokee Basin. That activity has centered in Neosho, Montgomery and Wilson counties, near the state's border with Oklahoma. The Kansas Geological Survey notes that nearly 800 wells have been drilled in its portion of the Cherokee Basin for CBM, and it forecasts that the state's CBM production will be between 6- and 7 billion cubic feet (Bcf) in 2003. The Forest City Basin, however, is in the initial stages of CBM exploration. The KGS says that around 100 CBM wells have been drilled there to date, mainly in Johnson and Miami counties. The area is attractive to companies because of its multiple coal seams, established pipeline network and predominance of private landowners. The coal seams in the Forest City Basin are basically the same ones that produce in the Cherokee Basin, says Larry Brady, senior scientist with the KGS. "There are variations, however, and coals that become important in the Forest City may be different than those in the Cherokee Basin." Denver-based Evergreen Resources Inc. is the high-profile player in the emerging CBM basin. The company has accumulated more than 700,000 acres in northeastern Kansas, including a purchase this summer of 43,000 acres from Bakersfield, California-based Berry Petroleum Co. From another independent, Evergreen picked up a pilot project in Atchison County that contains 12 CBM wells, a water injection well and a gathering system. "We have drilled 10 CBM wells and one water-disposal well in Kansas," said Mark Sexton, president and chief executive officer, in a recent third-quarter 2003 earnings conference call. He noted that those wells have encountered aggregate coal thicknesses of six to 25 feet in multiple seams, with typical seams ranging between one and four feet. The coal quality looks promising, with good cleating and permeability. One pleasant surprise for Evergreen is that the gas sands are coming in with aggregate thicknesses between 15 and 30 feet, high on the range of what it expected. "We really don't know how good the project is going to be until we complete the wells, but at this early stage we are seeing what we expected to see in the basin." The company plans to complete 40 wells by year-end 2003. These will be in seven pilot areas spread around its acreage, with each pilot containing four producing wells and one disposal well. In addition, it plans five core holes. According to the Kansas Corporation Commission, Evergreen has already permitted wells in Doniphan, Jackson, Miami and Linn counties. During 2004, Evergreen has budgeted $58 million for the Forest City Basin. This will be used to drill 150 wells in the area, build gathering and compression facilities, and pay for additional equipment and acquisitions. It expects to produce between 1.2 and 1.9 Bcf from its Kansas CBM wells during 2004. Evergreen figures a producing well costs around $100,000 to drill and complete; the core holes run $130,000. Prorated gathering adds another $70,000 to $80,000 per well. The CBM wells, which range in depth from 750 to 2,000 feet, are forecast to recover between 250- and 400 million cubic feet of gas apiece. Other players are also active in the basin. Heartland Oil & Gas Corp., based in Vancouver, is working on a five-well pilot project in Nemaha County. It has acquired some 165,000 acres in the play, and reports that its Engelke 16-18 discovery well encountered 57 feet of coal. Heartland recently closed on a $12-million private placement, in which C.K. Cooper & Co. acted as agent. The capital will be used to finance an aggressive development program on its Forest City Basin acreage. Additionally, local independent Osborn Energy LLC is working in Miami and Johnson counties, and Radnor, Pennsylvania-based Penn Virginia Oil & Gas Corp. has a pilot in Chase County. And, Suncor Energy and Meritage KCM Exploration both have pilots under way in Anderson County.