Coal beds are considered to be a major source of nonassociated gas in the Rocky Mountain basins of the United States. In the San Juan basin of northwestern New Mexico and southwestern Colorado, significant quantities of natural gas are being produced from coal beds of the Upper Cretaceous Fruitland Formation and from adjacent sandstone reservoirs. Analysis of gas samples from the various gas-producing intervals provided a means of determining their origin and of evaluating coal beds as source rocks.

The rank of coal beds in the Fruitland Formation in the central part of the San Juan basin, where major gas production occurs, increases to the northeast and ranges from high-volatile B bituminous coal to medium-volatile bituminous coal (R_m values range from 0.70 to 1.45%). On the basis of chemical, isotopic and coal-rank data, the gases are interpreted to be thermogenic. Gases from the coal beds show little isotopic variation (δ¹³C₁ values range −43.6 to −40.5 ppt), are chemically dry (C₁/C_1–5 values are > 0.99), and contain significant amounts of CO₂ (as much as 6%). These gases are interpreted to have resulted from devolatilization of the humic-type bituminous coal that is composed mainly of vitrinite. The primary products of this process are CH₄, CO₂ and H₂O.

The coal-generated, methane-rich gas is usually contained in the coal beds of the Fruitland Formation, and has not been expelled and has not migrated into the adjacent sandstone reservoirs. In addition, the coal-bed reservoirs produce a distinctive bicarbonate-type connate water and have higher reservoir pressures than adjacent sandstones. The combination of these factors indicates that coal beds are a closed reservoir system created by the gases, waters, and associated pressures in the micropore coal structure.

In contrast, gases produced from overlying sandstones in the Fruitland Formation and underlying Pictured Cliffs Sandstone have a wider range of isotopic values (δ¹³C₁ values range from −43.5 to −38.5 ppt), are chemically wetter (C₁/C_1–5 values range from 0.85 to 0.95), and contain less CO₂ (< 2%). These gases are interpreted to have been derived from type III kerogen dispersed in marine shales of the underlying Lewis Shale and nonmarine shales of the Fruitland Formation.

In the underlying Upper Cretaceous Dakota Sandstone and Tocito Sandstone Lentil of the Mancos Shale, another gas type is produced. This gas is associated with oil at intermediate stages of thermal maturity and is isotopically lighter and chemically wetter at the intermediate stage of thermal maturity as compared with gases derived from dispersed type III kerogen and coal; this gas type is interpreted to have been generated from type II kerogen.

Organic matter contained in coal beds and carbonaceous shales of the Fruitland Formation has hydrogen indexes from Rock-Eval pyrolysis between 100 and 350, and atomic H:C ratios between 0.8 and 1.2. Oxygen indexes and atomic O:C values are less than 24 and 0.3, respectively. Extractable hydrocarbon yields are as high as 7,000 ppm. These values indicate that the coal beds and carbonaceous shales have good potential for the generation of liquid hydrocarbons. Voids in the coal filled with a fluorescent material that is probably bitumen is evidence that liquid hydrocarbon generation has taken place. Preliminary oil-source rock correlations based on gas chromatography and stable carbon isotope ratios of C₁₅₊ hydrocarbons indicate that the coals and (or) carbonaceous shales in the Fruitland Formation may be the source of minor amounts of condensate produced from the coal beds at relatively low levelsof thermal maturity (R_m=0.7).