I own a small quantity of minerals in DeSoto Parish around Stanley.  Purchased the property subject to an existing lease held by production many years ago, sold the land and reserved some of the minerals.  Over the years, the mineral leases (1/8, of course, standard Bath form from more than 40 years ago) have been split into shallow and deep ownership, and the owners of both have changed hands several times.  The shallow rights are currently operated by Amplify and held by several Hosston wells.  Those wells have produced a total of 704 MCF in the past 12 months.  Presumably these wells, drilled and completed in 2000, don't need much production to meet the paying quantities test, but 58 MCF per month?  I know that there have been several discussions on paying quantities, but this one seems somewhat closer to meeting the test for a release.

Second issue is this:  Comstock holds the deep rights.  Over the past few years, they have taken out 7  six-month HA permits, all of which have expired.  This month, they took out number 8.  Comstock also holds the HA rights in 4 or 5 adjoining sections, with the same pattern.  They have not applied for a CUL permit for any of these, although they are very active in drilling CULs a few miles west of these holdings.  They hold the deep rights in the contiguous section to the north.  I can't imagine that they intend to drill under any of the permits that they just obtained.  So, my question to the experts here is why do they keep taking out 6 month permits when they clearly have no intent to drill a single unit well?   It appears that their deep rights are the result of a farmout from BP, but i don't know any details about that, or the impact on this situation.

If I could make the case that the old lease has expired and demand a release, perhaps I could negotiate a new lease at some royalty better than the existing 1/8?  There is a risk here since I am only a mineral owner, because I don't want to start the 10 year clock ticking.  But it seems likely that this section will be in a unit for a HA well sooner or later. I prefer to NOT be an unleased mineral owner, but the revenue from this lease is so small that being unleased might not be so bad if an HA well is drilled.

thoughts?

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A lot of early Haynesville Shale wells are becoming candidates for the production in paying quantities test.  A lot of older, vertical wells would not pass the test but mineral owners rarely demand that a lease be terminated.  I've seen a lot of expired permits over the last year also.  Some wells or well groups had been permitted by an operating company that divested their interest before they drilled the wells and some newer operators permitted alternate unit wells and then allowed those permits to expire in favor of HC wells (Horizontal Cross).  Comstock in particular has a problem with a lot of units that are in danger of losing the development rights.  This is best illustrated by this very recent group of well permits, all unit wells permitted on the same date.  A pretty rare occurrence but I wouldn't call them insincere.  In fact I think they are urgent permits hoping to get a rig soon or face the prospect that they will receive a demand for a release of lease.

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my minerals are in that group.  I still can't understand why the would obtain a permit every six months at least on 6 of those 8 sections, all on the same day, and after they expire, go take out 6 new ones, and do that twice a year for 4 years.   Comstock has been drilling steadily a few miles to the west in the Logansport field, and has recently shifted to getting new units for Cross Unit Laterals.  That makes sense.  I just can't fathom why they have been repeatedly taking out permits year after year in 6 of the units you list above. and all of these are for simple one-section units.  That's why i suggest that they actually have no intention of drilling in any of the six.  

I could put them and Amplify on notice and ask for a release, but my acreage is so small, I doubt they would care.

You can find one of your larger mineral owners in that section and bring it to his attention. If he was interested in filing, you could join him as payment for bringing it to his attention.
Jay

good idea.  thanks.

Steve, if you need some help, let me know.

thanks.  got a full work load over the next week (I'm partially retired, so how does that happen?).  I'll likely start with getting a DeSoto tax assessors plat for the section, maybe even the surrounding sections, and see if I recognize any names (from 30 years ago).  In that area, the landowner generally owns the minerals.

You might even get lucky and the unit survey is in the database.  A unit survey will list all the ownership interests, their acreage and percent ownership in the unit.

no HA well has been drilled yet.  The last unit survey was in 2000 for the last Hosston that was drilled.

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