When Arrow Energy listed on the ASX in August 2000 it was with a traditional oil and gas focus. As the new century developed, the company decided, as did a number of their peers, to join the search for exploitable coal bed methane reserves.

A crucial step for them was the acquisition of the assets of Ron Prefontaine's Australian CBM (ACBM). Prefontaine is a leading figure in Queensland CBM exploration and is now an Arrow director. It is those assets from which Arrow hope to grow a bankable project, based on their drilling success in PLA 185 and other CBM areas. Arrow has purchased 55% of ACBM and has an option until July this year to acquire the remaining 45% of ACBM.

Another local CBM explorer, Queensland Gas Company, farmed into some of ACBM's acreage previously and has shouldered the exploration costs in those areas as part of the deal. To date, the Avon Downs area (ATP 676P) has the makings of a successful CBM region. The well is currently shut in while the two partners make a decision on development.

Prefontaine hopes that like their partner, QGC, and their recently announced Aberdeen pilot well program, Arrow also will be announcing a pilot well program in the Surat, based around the Dundee area in PLA 185. He said that as part of the process to achieve bankable status, Arrow cored a well adjacent to Dundee-1 called Dundee-2 and is currently desorbing the coals to determine gas content. Dundee-2 was completed as a shallow gas producer.

"We are going to feed the gas (from Dundee-2) straight into a gas-fired power plant for our own power," said Prefontaine. "If all goes to plan Arrow will commence it's own a pilot program. The pilot will consist of five wells in a dice layout that will dewater an area to maximise production from the central well."