Jordan Blum, editorial director, Hart Energy: We are here at Hart Energy's America's Natural Gas Conference in Houston and I'm joined by PureWest Energy CEO, Chris Valdez, for this Hart Energy Live Exclusive Interview. Thank you so much for joining us. So y'all are very focused in Wyoming obviously, but it's not so much the Powder River Basin, it's the Green River Basin and the Pinedale and Jonah Fields specifically. Can I get you to just elaborate on the focus and the growth strategy?

Chris Valdez, CEO, PureWest Energy: You bet and thanks for having me here today. So we are focused primarily on the Pinedale Anticline. We do have a few sections in Jonah Field, but that is not where we're going to be targeting going forward. We have about 108,000 net acres, 3,500 well bores that we operate. We recently had a transaction where we sold a portion of those well bores, 1,700 of those to a group called Winco Asset Management and we are their contract operator, but we retained all the lease hold and we're continuing to develop in and around those locations. We are the largest natural gas producer in the state of Wyoming. Operated natural gas producer. We're about 600 MMcf/d operated, and our net production is right around 270 post-transaction. So what we're doing on the Anticline, as you know, it's been developed for a number of decades.

We believe that we have about 1,500 remaining locations, which represents about 60 rig years of inventory and we're applying new completion techniques. Historically on the Anticline, they pumped 25,000 bbl of crosslink gels and as recently as 2019, that was good enough to achieve a 3 Bcf well. So we are establishing a baseline right now and pumping 10 times that volume, slick water versus crosslink and we're getting two to 3.5x uplift from these completion jobs in this baseline that we're establishing. And we're currently on location now and we're planning to pump 500,000 bbl to really test what the rock can do long term. It's a continuous gas charge fluvial system. We have about 6,000 ft of gross pay and so you could think about we're drilling vertical wells, so that's one thing that we need to distinguish in the upper green of our basin. So our S-shaped wells, you can consider those to be section length laterals.

JB: Very good. So there's obviously a lot of runway there. Is the strategy to just really focus on the acreage you have or potentially grow beyond continuously or in the surrounding areas?

CV: So we've had the good fortune of being able to block up the Anticline. We started with Ultra Petroleum's legacy position, then we added to that with some non-op acquisitions and then we finished the consolidation on the north side of the Anticline by buying the asset that was historically operated by QEP. So we have a lot of running room. In addition to that, there were some acreage on the south side of the Anticline that our neighbors to the south, Jonah Energy, we were at a checkerboard position with them. We were able to block that up, so we have plenty of running room on the Anticline currently. Another thing that's really beneficial, this asset being as old as it is, it was developed for a different time. It was developed to produce 2 Bcf/d of natural gas.

So what that affords us is redundant and centralized infrastructure. We don't have to build out any infrastructure. We have all the processing and infield gathering that we need and that also provides us access to premium western markets. So one thing that people don't really realize right now is that for 2023 we're averaging $8.50/MMBtu for our volumes. If you look at the premier plays in North America right now, being the Haynesville and Marcellus, we're $6/MMBtu ahead of those. Over the last three years we've averaged $6.50/MMBtu and during that period it's $2.50 to $3 ahead of Haynesville and Marcellus. So in addition to having very good rock quality, we have this price premium for our development. So planning to stay focused on the Pinedale Anticline. If market conditions arise where we can find a similar fluvial system where we have a technical and commercial edge in the West Rockies and market conditions dictate that we could make an attractive acquisition at a good valuation, we would consider it, but right now we have plenty of running room and we're planning to optimize our development.

JB: Makes a lot of sense. Y'all have a lot of focus on emissions reductions, ESG strategies. Can I get you to talk about that and kind of the green gas goal, so to speak?

CV: Absolutely. We are working hard to create a differentiated gas market. So what we realized early on as a management team is that we were leading in the space in terms of methane intensity rate. Our methane intensity rate's 0.05%, which is as recently as 2022 was 90% below the industry average. We wanted to get acknowledgement and credit for that and it really goes back to the early development on the Anticline under the record of decision and the environmental impact statement from 2008, which under that framework, the predecessor operators were required to install liquids gathering systems, which removes tankage and jewelry that can leak. So what we're doing is we're getting credit for that and the first move that we made was to certify our production. We partnered with Trustwell and of our certified production, majority of it's platinum and gold standard according to the Trustwell metrics.

And we are working to sell certified gas currently. And one thing that's unique is we've also partnered with a blockchain company because what we found is that our customers who are wanting to buy certified gas wanted to ensure the veracity of our environmental attributes. So the best way to do that was with a digital blockchain. So they are tied into our production accounting system and for every MMBtu that we produce, we mint a digital token that shares time and date that that molecule is produced, what location, whether it was a gold or a platinum rated well and then it currently has our field-wide methane intensity rate. The evolution of this market is we're going to start minting quantified emissions tokens. So we will have onsite emissions monitoring in addition to corroborating that with mass balance and then also we will have traditional flyout for metrics for measuring methane.

JB: Great. That's really fascinating actually. Just switching gears a bit, PureWest earlier this year was acquired by a consortium of family offices and financial institutions. It's a fairly unique deal, I think. Do you see that as kind of a growing trend as well with more family offices and such filling financial voids in energy?

CV: I don't know how much of a trend it will be. There's definitely interest with producers that would like to monetize to talk to any of these groups. It was something that really worked out for us. We went out with what we were calling the Hearts and Minds Tour to get the story out on the Anticline. At one time, these were the original unconventional plays, but they were lost in time. I talked about the technology perspective and just what they were doing on the completion front, and people really hadn't been thinking about these assets and the family offices did identify this opportunity. They liked the market dynamics. Our board would be supportive of further acquisitions if the right valuation is in place and it fits with our overall strategy. As I mentioned, having market access, having infrastructure in place and where we have an edge was technically and commercially, I could see them adding to it. I've heard some other folks talking to the family offices. So traditionally the family offices would invest into a private equity pool and then that's how they would access these markets. So they're just going direct now. Maybe that continues on, but I think that we had a pretty unique opportunity in this transaction.

JB: Thank you so much for joining us for this Hart Energy LIVE Exclusive Interview. To read and watch more, please visit online at

CV: Thank you.