Methane Project	9 Months Ended
Sep. 30, 2011
Methane Project [Abstract]
Methane Project	(11) Methane Project On October 24, 2006, the Company signed a twenty-year Landfill Gas Sale and Purchase Agreement (the "Agreement") with BFI Waste Systems of Tennessee, LLC ("BFI"), an affiliate of Allied Waste Industries ("Allied"). In 2008, Allied merged into Republic Services, Inc. ("Republic"). The Company assigned its interest in the Agreement to MMC. The Agreement provides that MMC will purchase the entire naturally produced gas stream being collected at the Carter Valley municipal solid waste landfill owned and operated by Republic in Church Hill, Tennessee serving the metropolitan area of Kingsport, Tennessee. Republic's facility is located about two miles from the Company's pipeline. The Company installed a proprietary combination of advanced gas treatment technology to extract the methane component of the purchased gas stream. Methane is the principal component of natural gas and makes up about half of the purchased raw gas stream by volume. The Company constructed a pipeline to deliver the extracted methane gas to the Company's existing pipeline (the "Methane Project"). The total cost for the Methane Project, including pipeline construction, was approximately $4.5 million. The costs of the Methane Project were funded primarily by (a) the money received by the Company from Hoactzin to purchase its interest in the Ten Well Program (which exceeded the Company's actual costs of drilling the wells in that Program by more than $1 million); (b) cash flow from the Company's operations; and (c) $0.8 million of funds the Company borrowed under its credit facility. Methane gas produced by the project facilities was initially mixed in the Company's pipeline and delivered and sold to Eastman under the terms of the Company's natural gas purchase and sale agreement with Eastman. The gas supply from this landfill is projected to grow over the years as the underlying operating landfill continues to expand and generate additional naturally produced gas, and for several years following the closing of the landfill, estimated by Republic to occur in 2041. Gas production is expected to continue in commercial quantities up to 10 years after closure of the landfill. As part of the Methane Project agreement, the Company installed a new force-main water drainage line for Republic, the landfill owner, in the same two-mile pipeline trench as the gas pipeline needed for the Project, reducing overall costs and avoiding environmental effects to private landowners resulting from multiple installations of pipeline. Republic paid the additional material costs for the water line of approximately $0.7 million. As a certificated utility, the Company's pipeline subsidiary, TPC, required no additional permits for the gas pipeline construction. MMC declared startup of commercial operations on April 1, 2009. During the month of April, the facility produced and sold 14 MMcf of methane gas to Eastman and was online about 91% of the calendar month. System maintenance and landfill supply adjustments accounted for the remainder of the time. On May 1, 2009, Eastman advised MMC that it was suspending deliveries of the methane gas stream pending approval by the federal Environmental Protection Agency ("EPA") of Eastman's petition for inclusion of treated methane gas as natural gas within the meaning of the EPA's continuous emission monitoring rules applicable to Eastman's large boilers during the annual "smog season" beginning May 1 of each year. Although Eastman had begun seeking this approval in February, 2009, with the assistance of the Air Quality Department of the Tennessee Department of Environment and Conservation, the EPA had not acted by May 1. Eastman furnished to the EPA information provided by MMC that establishes that the methane gas stream is better fuel under the rule standards than even "natural" gas, which is technically defined in the smog season rules to include gas being "found in geologic formations beneath the earth's surface". Methane sales to Eastman were intended to resume upon EPA's formal approval of Eastman's petition or expansion of the regulatory definition, or both. Because approval was not received, MMC was forced to seek alternative markets for the methane gas stream. The Company concluded an agreement for sale of the methane gas to Hawkins County Gas Utility, a local utility commencing August 1, 2009 on a month to month basis. Effective September 1, 2009 the Company began sales of its Swan Creek gas production to Hawkins County Gas Utility District, because the physical mixing of Swan Creek natural gas with MMC's methane gas caused Eastman to not accept delivery of both categories of gas as mixed. On August 27, 2009, the Company entered into a five-year fixed price gas sales contract with Atmos Energy Marketing, LLC, ("AEM") in Houston, Texas, a nonregulated unit of Atmos Energy Corporation (NYSE: ATO) for the sale of the methane component of landfill gas produced by MMC at the Carter Valley Landfill. The agreement provides for the sale of up to 600 MMBtu per day. The contract was effective beginning with September 2009 gas production and ends July 31, 2014. The agreed contract price of over $6 per MMBtu was a premium to the then current five-year strip price for natural gas on the NYMEX futures market. The Methane Project is designed to be capable of producing a daily average of about 500 MMBtu/day of methane from the Carter Valley landfill assuming the raw gas volumes being generated underground and collected in Republic's piping and collection system are sufficient to do so. However, in order to produce maximum levels on a given day, the raw gas volume must be available and the plant needs to remain in operation for the full 24 hours that day. Daily production decreases on days when the plant operates less than a full 24 hours, whether due to any equipment or collection system supply issue. The primary reason experienced for less-than-full-24-hour operation since April 2009 has been frequent spiking in the oxygen content in the raw gas collected by Republic and delivered to the plant, and not to equipment malfunctions in MMC's plant. Oxygen spikes shut down MMC's equipment for safety reasons as high oxygen gas is explosive in our treatment process. In mid-2010, the oxygen spikes increased from occasional spikes to an almost constant high level of oxygen that caused longer downtime to our equipment. During the first quarter of 2011, the oxygen spikes continued throughout the quarter, with the plant only being able to produce during a two week period in March 2011 or about 13% of the total hours during the first quarter. Similarly, during the second quarter of 2011, production occurred for only 19% of total hours during the quarter, due primarily to oxygen levels in the raw gas, as well as rising water levels in the collection system choking back volumes of gas available for delivery to MMC's treatment equipment. To attempt to increase volumes by pulling higher vacuum on the collection system when this additional high water circumstance arises would introduce water into our treatment equipment and damage plant equipment. In the third quarter of 2011, the plant operated for only 26% of the total hours during the quarter for primarily the same reasons. Plant maintenance did cause a portion of the production downtime due to need to obtain unscheduled replacement parts not normally kept on hand. Republic commenced a major gas collection system repair and rework in September 2011 and anticipates more adequately addressing both these oxygen and water problems. Simultaneously, Republic planned to drill additional gas collection wells in the landfill. The repairs should reduce air and water intrusion and allow MMC's plant to avoid shutdowns for safety and increase run time and consequently increase produced methane volumes. The new wells are due primarily to the growth of the working landfill, and should result in previously undelivered volumes of raw gas being sent to MMC's plant, so methane production volumes should additionally increase as a result of the new wells. As of the date of this Report, we are advised by Republic that four new wells have been drilled in the landfill, and the other collection system repairs are near completion. The Company anticipates that Republic's collection system may continue to require repairs from time to time and no assurances can be made concerning when Republic's system repairs may again be needed and if so, when such repairs may be concluded. If such additional repairs become necessary, until such time that the repairs are completed, the Company anticipates that only intermittent and minimal volumes would be produced. In addition to the further system repairs being performed by Republic on its gas collection system, MMC determined to also address the high-oxygen level problem experienced to date by rerouting a portion of the recycle gas stream from MMC's plant operation to fuel electric generation at the plant site. This is anticipated to have a dual benefit to MMC of (1) offsetting significant electricity costs incurred to run the large 300-horsepower compressors needed to refine the methane, and (2) increasing overall run time of the methane plant and consequently increasing overall methane production. Plant run time is anticipated to increase because rerouting this existing recycle gas stream should reduce the oxygen level at plant inlet by about one half percent, thereby causing significantly fewer shutdowns for high oxygen at MMC's plant inlet. The increased run times are expected to fully offset the reduction in methane production efficiency necessarily caused by rerouting the recycle gas stream for use as generator fuel. The installation of the equipment required to reroute the recycle gas stream and fuel a generator is currently anticipated to be completed in the fourth quarter of 2011. MMC anticipates, but cannot assure, that when completed, the combined effects of new landfill wells, the Republic workover of its collection system, and the plant configuration to alter the recycle gas usage may result in significant improvement in the economic performance of the MMC plant. On September 17, 2007, Hoactzin, simultaneously with subscribing to participate in the Ten Well Program (the "Program"), pursuant to a separate agreement with the Company was conveyed a 75% net profits interest in the Methane Project. Any net profits from the Methane Project, if received by Hoactzin, would be applied towards the determination of the Payout Point (as defined above) for the Ten Well Program. When the Payout Point is reached from either the revenues from the wells drilled in the Program or the Methane Project or a combination thereof, Hoactzin's net profits interest in the Methane Project will decrease to 7.5%. The agreed method of calculation of net profits takes into account specific costs and expenses as well as gross revenues for the project. As a result of the production levels discussed above, no net profits as defined have been generated from project startup in April, 2009 through September 30, 2011 for payment to Hoactzin under the net profits interest conveyed. As stated above, the Purchase Price paid by Hoactzin for its interest in the Program exceeded the Company's actual costs of drilling the ten wells in the Program. Those excess funds provided by Hoactzin were used to pay for approximately $1 million of equipment required for the Methane Project, or about 22% of the Project's capital costs. The availability of the funds provided by Hoactzin eliminated the need for the Company to borrow those funds, to have to pay interest to any lending institution making such loans or to dedicate Company revenues or revenues from the Methane Project to pay such debt service. Accordingly, the grant of a 7.5% interest in the Methane Project to Hoactzin was negotiated by the Company as a favorable element to the Company of the overall transaction.

(11) Methane Project

On October 24, 2006, the Company signed a twenty-year Landfill Gas Sale and Purchase Agreement (the "Agreement") with BFI Waste Systems of Tennessee, LLC ("BFI"), an affiliate of Allied Waste Industries ("Allied").

In 2008, Allied merged into Republic Services, Inc. ("Republic"). The Company assigned its interest in the Agreement to MMC. The Agreement provides that MMC will purchase the entire naturally produced gas stream being collected at the Carter Valley municipal solid waste landfill owned and operated by Republic in Church Hill, Tennessee serving the metropolitan area of Kingsport, Tennessee. Republic's facility is located about two miles from the Company's pipeline. The Company installed a proprietary combination of advanced gas treatment technology to extract the methane component of the purchased gas stream. Methane is the principal component of natural gas and makes up about half of the purchased raw gas stream by volume. The Company constructed a pipeline to deliver the extracted methane gas to the Company's existing pipeline (the "Methane Project").

The total cost for the Methane Project, including pipeline construction, was approximately $4.5 million. The costs of the Methane Project were funded primarily by (a) the money received by the Company from Hoactzin to purchase its interest in the Ten Well Program (which exceeded the Company's actual costs of drilling the wells in that Program by more than $1 million); (b) cash flow from the Company's operations; and (c) $0.8 million of funds the Company borrowed under its credit facility. Methane gas produced by the project facilities was initially mixed in the Company's pipeline and delivered and sold to Eastman under the terms of the Company's natural gas purchase and sale agreement with Eastman. The gas supply from this landfill is projected to grow over the years as the underlying operating landfill continues to expand and generate additional naturally produced gas, and for several years following the closing of the landfill, estimated by Republic to occur in 2041. Gas production is expected to continue in commercial quantities up to 10 years after closure of the landfill.

As part of the Methane Project agreement, the Company installed a new force-main water drainage line for Republic, the landfill owner, in the same two-mile pipeline trench as the gas pipeline needed for the Project, reducing overall costs and avoiding environmental effects to private landowners resulting from multiple installations of pipeline. Republic paid the additional material costs for the water line of approximately $0.7 million. As a certificated utility, the Company's pipeline subsidiary, TPC, required no additional permits for the gas pipeline construction.

MMC declared startup of commercial operations on April 1, 2009. During the month of April, the facility produced and sold 14 MMcf of methane gas to Eastman and was online about 91% of the calendar month.

System maintenance and landfill supply adjustments accounted for the remainder of the time. On May 1, 2009, Eastman advised MMC that it was suspending deliveries of the methane gas stream pending approval by the federal Environmental Protection Agency ("EPA") of Eastman's petition for inclusion of treated methane gas as natural gas within the meaning of the EPA's continuous emission monitoring rules applicable to Eastman's large boilers during the annual "smog season" beginning May 1 of each year. Although Eastman had begun seeking this approval in February, 2009, with the assistance of the Air Quality Department of the Tennessee Department of Environment and Conservation, the EPA had not acted by May 1. Eastman furnished to the EPA information provided by MMC that establishes that the methane gas stream is better fuel under the rule standards than even "natural" gas, which is technically defined in the smog season rules to include gas being "found in geologic formations beneath the earth's surface". Methane sales to Eastman were intended to resume upon EPA's formal approval of Eastman's petition or expansion of the regulatory definition, or both. Because approval was not received, MMC was forced to seek alternative markets for the methane gas stream.

The Company concluded an agreement for sale of the methane gas to Hawkins County Gas Utility, a local utility commencing August 1, 2009 on a month to month basis.

Effective September 1, 2009 the Company began sales of its Swan Creek gas production to Hawkins County Gas Utility District, because the physical mixing of Swan Creek natural gas with MMC's methane gas caused Eastman to not accept delivery of both categories of gas as mixed.

On August 27, 2009, the Company entered into a five-year fixed price gas sales contract with Atmos Energy Marketing, LLC, ("AEM") in Houston, Texas, a nonregulated unit of Atmos Energy Corporation (NYSE: ATO) for the sale of the methane component of landfill gas produced by MMC at the Carter Valley Landfill. The agreement provides for the sale of up to 600 MMBtu per day. The contract was effective beginning with September 2009 gas production and ends July 31, 2014. The agreed contract price of over $6 per MMBtu was a premium to the then current five-year strip price for natural gas on the NYMEX futures market.

The Methane Project is designed to be capable of producing a daily average of about 500 MMBtu/day of methane from the Carter Valley landfill assuming the raw gas volumes being generated underground and collected in Republic's piping and collection system are sufficient to do so. However, in order to produce maximum levels on a given day, the raw gas volume must be available and the plant needs to remain in operation for the full 24 hours that day. Daily production decreases on days when the plant operates less than a full 24 hours, whether due to any equipment or collection system supply issue. The primary reason experienced for less-than-full-24-hour operation since April 2009 has been frequent spiking in the oxygen content in the raw gas collected by Republic and delivered to the plant, and not to equipment malfunctions in MMC's plant. Oxygen spikes shut down MMC's equipment for safety reasons as high oxygen gas is explosive in our treatment process.

In mid-2010, the oxygen spikes increased from occasional spikes to an almost constant high level of oxygen that caused longer downtime to our equipment. During the first quarter of 2011, the oxygen spikes continued throughout the quarter, with the plant only being able to produce during a two week period in March 2011 or about 13% of the total hours during the first quarter.

Similarly, during the second quarter of 2011, production occurred for only 19% of total hours during the quarter, due primarily to oxygen levels in the raw gas, as well as rising water levels in the collection system choking back volumes of gas available for delivery to MMC's treatment equipment. To attempt to increase volumes by pulling higher vacuum on the collection system when this additional high water circumstance arises would introduce water into our treatment equipment and damage plant equipment.

In the third quarter of 2011, the plant operated for only 26% of the total hours during the quarter for primarily the same reasons. Plant maintenance did cause a portion of the production downtime due to need to obtain unscheduled replacement parts not normally kept on hand.

Republic commenced a major gas collection system repair and rework in September 2011 and anticipates more adequately addressing both these oxygen and water problems. Simultaneously, Republic planned to drill additional gas collection wells in the landfill. The repairs should reduce air and water intrusion and allow MMC's plant to avoid shutdowns for safety and increase run time and consequently increase produced methane volumes. The new wells are due primarily to the growth of the working landfill, and should result in previously undelivered volumes of raw gas being sent to MMC's plant, so methane production volumes should additionally increase as a result of the new wells. As of the date of this Report, we are advised by Republic that four new wells have been drilled in the landfill, and the other collection system repairs are near completion. The Company anticipates that Republic's collection system may continue to require repairs from time to time and no assurances can be made concerning when Republic's system repairs may again be needed and if so, when such repairs may be concluded. If such additional repairs become necessary, until such time that the repairs are completed, the Company anticipates that only intermittent and minimal volumes would be produced.

In addition to the further system repairs being performed by Republic on its gas collection system, MMC determined to also address the high-oxygen level problem experienced to date by rerouting a portion of the recycle gas stream from MMC's plant operation to fuel electric generation at the plant site. This is anticipated to have a dual benefit to MMC of (1) offsetting significant electricity costs incurred to run the large 300-horsepower compressors needed to refine the methane, and (2) increasing overall run time of the methane plant and consequently increasing overall methane production. Plant run time is anticipated to increase because rerouting this existing recycle gas stream should reduce the oxygen level at plant inlet by about one half percent, thereby causing significantly fewer shutdowns for high oxygen at MMC's plant inlet. The increased run times are expected to fully offset the reduction in methane production efficiency necessarily caused by rerouting the recycle gas stream for use as generator fuel. The installation of the equipment required to reroute the recycle gas stream and fuel a generator is currently anticipated to be completed in the fourth quarter of 2011. MMC anticipates, but cannot assure, that when completed, the combined effects of new landfill wells, the Republic workover of its collection system, and the plant configuration to alter the recycle gas usage may result in significant improvement in the economic performance of the MMC plant.

On September 17, 2007, Hoactzin, simultaneously with subscribing to participate in the Ten Well Program (the "Program"), pursuant to a separate agreement with the Company was conveyed a 75% net profits interest in the Methane Project. Any net profits from the Methane Project, if received by Hoactzin, would be applied towards the determination of the Payout Point (as defined above) for the Ten Well Program. When the Payout Point is reached from either the revenues from the wells drilled in the Program or the Methane Project or a combination thereof, Hoactzin's net profits interest in the Methane Project will decrease to 7.5%. The agreed method of calculation of net profits takes into account specific costs and expenses as well as gross revenues for the project. As a result of the production levels discussed above, no net profits as defined have been generated from project startup in April, 2009 through September 30, 2011 for payment to Hoactzin under the net profits interest conveyed.

As stated above, the Purchase Price paid by Hoactzin for its interest in the Program exceeded the Company's actual costs of drilling the ten wells in the Program. Those excess funds provided by Hoactzin were used to pay for approximately $1 million of equipment required for the Methane Project, or about 22% of the Project's capital costs. The availability of the funds provided by Hoactzin eliminated the need for the Company to borrow those funds, to have to pay interest to any lending institution making such loans or to dedicate Company revenues or revenues from the Methane Project to pay such debt service. Accordingly, the grant of a 7.5% interest in the Methane Project to Hoactzin was negotiated by the Company as a favorable element to the Company of the overall transaction.