1st NRG Corp. (OTCBB: FNRC
) is an exploration and production company engaged in the development of natural gas producing properties in the Powder River Basin of Wyoming. Headquartered in Denver, Colorado, our activity has been centered upon the development of coal bed methane reserves where we hold a working interest in 42 producing wells, 1 permitted location and 2,821 undeveloped acres. We acquired our interest in October 2010 and the 42 wells which currently make up the field are shut in. The undeveloped acreage could be permitted for 35 locations which are characterized by what we believe to be low geologic risk, a repeatable development opportunity and are offsetting wells which all demonstrated developed coal seams in the Schwartz, Anderson, Canyon, Cook and Wall formations.The Powder River Basin is a major source of coal bed methane - clean natural gas.
These shallow locations are approximately 1,900 feet in depth, and characterized by what we believe to be low geologic risk and a repeatable development opportunity. The operations offset existing wells, all of which have developed coal seams in the Schwartz, Anderson, Canyon, Cook and Wall formations.
Pursuant to approval from the Wyoming Oil and Gas Commission (the “WOGC
”), natural gas production is commingled from three coals in the producing wells: the Schwartz, Upper and Lower Smith, and the Wyodak/Anderson Lower. When water levels from these coal seams subside, we intend to perforate other behind pipe coal seams and begin producing from those coals as well. Using the same well bores and capital equipment (pumps, electricity, water and natural gas gathering systems) will result in lower total development costs per Mcf for the properties. We also expect cumulative recovery by simultaneous multiple seam production to be greater than single seam production and result in lower per Mcf operating costs and longer well lives.
The coal seams in the Powder River Basin that are targeted have been extensively mapped as a result of a variety of natural resource developments that have occurred in the region. Industry data from many wellbores drilled by others allows us to determine the extent, thickness, gas saturation, formation pressure and relative permeability of the coal seams. This reduces (but does not entirely eliminate) the risk of drilling unproductive wells.