Who We Are
GeoMet, Inc. was founded in 1985 as a consulting company to the coalbed methane (CBM) industry. Since 1993 we have been active as a developer and operator of coalbed methane properties. We, or our principals, have been responsible for the development of five successful large scale coalbed methane projects in four separate basins in the United States. Our CBM management, professional, and project management team participated in the drilling and operation of more than 2,700 CBM wells worldwide since 1977.
Our principal operations and producing properties are located in Alabama and the central Appalachian Basin. At December 31, 2012, we controlled a total of approximately 193,000 net acres of coalbed methane and oil and natural gas development rights, primarily in Alabama, West Virginia, Virginia. Our major holdings consist of approximately 39,000 net acres in Alabama and approximately 95,000 net acres in the central Appalachian Basin.
Using SEC methodology, our proved reserves as of December 31, 2012, as estimated by DeGolyer and MacNaughton and Ryder Scott Company, L.P., independent reservoir engineering firms, were approximately 137.2 Bcf. The 2012 proved reserves were 100% coalbed methane and 100% were developed.
We primarily explore for, develop and produce CBM. We believe that substantial expertise and experience is required to develop, produce, and operate coalbed methane and non-conventional shallow gas fields in an efficient manner. We believe that the inherent geologic and production characteristics of coalbed methane and non-conventional shallow gas offer significant operational advantages compared to conventional gas production, including:
- Production Rates. Unlike conventional natural gas production, which typically declines after initial production is established, production from CBM wells typically increases for the first few years of their productive lives although eventual peak rates are often lower than those of typical conventional gas wells. CBM wells also generally decline at a shallow rate relative to typical conventional gas wells.
- Low Geologic Risks. Most CBM areas are located in known coal basins where the coal resource has been evaluated for coal mining. These areas have extensive existing geologic information databases. The drilling of new coreholes and a limited number of production test wells reduces the geologic risk prior to committing large development expenditures.
- Low Production Costs. In the early stage of CBM project development per unit operating costs are high because production is initially low and many of our costs are fixed. As production from a project increases and economies of scale are realized, per unit operating costs typically decrease. Over the life of a project, we believe our average per unit operating costs will be lower than those of many conventional gas industry projects.
- Long-lived Reserves. Because CBM wells typically have inclining production rates early in their lives and low decline rates thereafter, CBM projects typically result in a reserve life that is significantly longer than many types of conventional gas production.
- Highly Experienced Team of CBM Professionals. Our CBM management, professional, and project management team has participated in the drilling and operation of more than 2,700 CBM wells worldwide since 1977.
- Track Record of Success in Identifying and Exploiting Large Underdeveloped Resource Plays. We pursue those projects that leverage our CBM expertise to exploit underdeveloped resource potential where we believe we can improve on the prior performance of other operators. We have a history of developing large scale projects in multiple basins with low finding and development costs and low project life operating costs.
Our objective is to create the premier non-conventional shallow gas company in North America (emphasizing coalbed methane) while maximizing stockholder value through the efficient investment of capital to increase reserves, production, cash flow and earnings. We intend to focus on the following strategies:
- Focus primarily on coalbed methane and non-conventional shallow gas to exploit our substantial expertise and experience
- Maximize present value in existing development projects and expand into adjacent areas to leverage our information, knowledge and infrastructure
- Develop new large scale projects, maintain operational control and reduce costs through economies of scale
- Maintain financial discipline