A James Lime Well in East Texas drilled and produced for 9 years so HBP a 600 acre lease with this one well--- Well made < 150 mmcf of the 9 years and last production about 1500 mcf in month ~50 mcfd --- CHK came in and removed everythink off pad site about 6 weeks ago--leaving only the drill site with pipe with control valve--- I assume well shut-in. This was on a old standard 88 lease I understand but have not seen or read it. How long does operator have in time to notify all royalty owners if well is shut-in? How long in general can they HBP (Shut in) the well? In chance on getting release of lease in nothing done with in 90 days and what required to get them to release the lease ?

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Ben--- Found answer after talking with operator ----they have 90 days, but they will most likely plan to just P&A by that time.

It depends on what the lease says.  Sounds like it contains a 90 day cessation of operations clause and a 90 day shut-in well provision, which means they must pay shut-in royalty within 90 days after it is shut-in for it to be considered "constructive production" to hold the lease.  But since they plan to P&A the well before the 90th day, they don't owe you shut-in royalties.  Question then is what is holding the lease? Is there another well?  Are they conducting any other operations?  Is there a Pugh clause?

only this one well ---so lease will expire all depths in 90 days --no pugh clause if so deep rights would already have expired so this is N/A-they have no plans for conducting any other operations--- other question now-- do they have any deadline by RRC to plug well since they will offically abandon well in 90 days? I assume they have to return pad site as close as can to it natural sitting as was before pad site build? What time frame to they have to complete it?

Check the lease, because it may have a clause regarding timing of P&A and removal of fixtures, etc...  Under RRC rule 3.14, they have 1 year after abandonment to plug the well.  Here is a link to the rule:  http://info.sos.state.tx.us/pls/pub/readtac$ext.TacPage?sl=T&ap...

They can ask for an extension under Rule 3.15.


thanks for info

--- Hope you have Merry Christmas

Ben--- have released my acreage in the unit with XTO---$1200/20% royalty free---:)-- they will drill a Bossier shale by 3rd year of lease I am sure.

very nice.

It would also be good to check and see if the well has been unitizatize. If so they can hold it unit ever drop is gone. Here is something to check on about unitization.  http://library.findlaw.com/2003/Jan/30/132512.html

And if the well is indeed a unit well, "they" will have to pay the mineral owner's proportionate share of production down to that last drop.

Skip--- see my post of May 28 :) have released since CHK lease terminated after 90 days of no activity

My comment was in reply to Alvin's above.

Sorry I miss that post. Glad they terminated it. Some companies will hold on to it so they can go back and drill new well under the same lease. We have some wells on our place that aren't in production anymore, but are in a unit. Back when these wells were drilled they was given an 1/8 and now I hear 1/4-1/5 interest.



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