Capital City Energy Group Inc. is planning to begin drilling for natural gas in eastern Ohio early next year.
The Columbus-based company said its Avanti Energy Partners LLC subsidiary expects a five-well natural gas drilling program to begin in the first quarter of 2009. It will target what’s known as the Clinton sandstone in the Appalachian Basin.
The company said other wells in the area it will drill have produced an average of about 35 million cubic feet of natural gas per well during their first year of production. Each well is expected to produce about 175 million cubic feet of natural gas in all, the company said.
Based on estimated output and on current natural gas prices, 25 wells would generate $7.5 million in annual revenue. Avanti wants to put 250 wells in the area and is working on securing 2,000 to 3,000 acres of land to do it.
“The economics of drilling wells in the Appalachian Basin combined with the high price of commodities make drilling in our own backyard very attractive,” Capital City CEO Timothy Crawford said in a news release.
Capital City Energy (OTCBB: CETG) manages energy-related investment funds and invests in energy-related production and development companies such as drillers, operators and pipeline owners. It turned a profit of $188,000 on $2.9 million in revenue last year.
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