Preparation Cook onion, garlic, and bay leaf in butter and 1/2 tablespoon oil with 1/8 teaspoon salt in a 12-inch heavy skillet over medium heat, stirring occasionally, until onion is beginning to brown, about 10 minutes. Transfer to a plate. Pat chicken dry and season with 1 teaspoon salt. Brown chicken in remaining tablespoon oil in 2 batches, 5 to 6 minutes per batch, transferring to a plate as browned. Discard all but 2 tablespoons fat from skillet, then stir in chile powder and onion mixture and cook, stirring, 1 minute. Stir in water and bring to a simmer, scraping up brown bits. Add chicken and cook, covered, over low heat, turning chicken once, until just cooked through, 25 to 30 minutes. Transfer chicken and onions with a slotted spoon to a platter. Skim off and discard fat from sauce, then boil until slightly thickened. Stir in lime juice and cilantro and spoon sauce over chicken.
Preparation Cook onion, garlic, and bay leaf in butter and 1/2 tablespoon oil with 1/8 teaspoon salt in a 12-inch heavy skillet over medium heat, stirring occasionally, until onion is beginning to brown, about 10 minutes. Transfer to a plate. Pat chicken dry and season with 1 teaspoon salt. Brown chicken in remaining tablespoon oil in 2 batches, 5 to 6 minutes per batch, transferring to a plate as browned. Discard all but 2 tablespoons fat from skillet, then stir in chile powder and onion mixture and cook, stirring, 1 minute. Stir in water and bring to a simmer, scraping up brown bits. Add chicken and cook, covered, over low heat, turning chicken once, until just cooked through, 25 to 30 minutes. Transfer chicken and onions with a slotted spoon to a platter. Skim off and discard fat from sauce, then boil until slightly thickened. Stir in lime juice and cilantro and spoon sauce over chicken.