The joint agreement outlines the development of natural gas on approximately 138,000 acres of CONSOL Energy's controlled acreage.

"This agreement represents a unique opportunity to exploit synergies between our established coalbed methane operations in southwest Virginia and the conventional gas resource below it," CONSOL CEO Brett Harvey said.

Currently, CONSOL Energy produces coalbed methane from the Pocahontas #3 and associated coal seams on these properties. None of these reserves are included in the agreement.

Based on preliminary analysis, conventional natural gas may reside in deeper formations. Triana Energy will be responsible for geological evaluation, drilling, and completion of all wells.

CONSOL Energy will be the operator of the wells, and will be responsible for construction and operation of all gathering systems.

Triana Energy is an oil and gas exploration company active in the Appalachian Basin. The company recently announced that it expected to acquire Columbia Natural Resources from NiSource. When final, the acquisition would make Triana one of the largest production companies in Appalachia.

The project is considered an exploration of an undeveloped area. No reserve estimates for conventional gas are available for this property. It is anticipated that drilling will start in the third quarter of this year.

"CONSOL Energy is an asset-rich company. Extracting additional value from existing assets, particularly where the physical and organizational infrastructure already exists, is a key objective for us," Harvey said.

CONSOL Energy Inc. is one of the largest U.S. producers of coalbed methane, with daily gas production of approximately 135 million cubic feet, primarily from wells in Virginia.

The company recently began coalbed methane production in Pennsylvania and West Virginia, and has a joint-venture company producing natural gas and oil in Tennessee.