Bullish on CNX Gas: Increased Acreage and Carbon Trading

CNX Gas (CXG) is an independent natural gas exploration and production company based in Pittsburgh with operations concentrated in the Appalachian basin, including many locations near my hometown in Western PA. The Company has increased its acreage position by 345% over the past three years to a total of 3.8 million acres through a mix of coalbed methane [CBM], unconventional shales, tight sands, and conventional deposits concentrated (63%) in the Appalachian basin. Proven reserves account for just 7% of the 3.8 million acres, with partially-assessed and un-assessed acres accounting for 46.5% each. The Company’s CBM assets alone are sufficient to achieve its 100 Bcf strategic goal by 2010 by simply tapping these reserves.