I looked up production for the Black Lake field today on sonris.  The last reported production was in December of 2010, when 2 barrels of oil were produced -- from the 20,000-acre field.  No production has been reported since then.  Certainly this is not what the state calls "production in paying quantities."

 

The leases in this field were signed in the mid-1960's, and have been in force ever since.  They were originally with Placid Oil, and have changed hands several times, and now are held by Chesapeake.  Has anyone been successful in terminating these leases?  Are there any efforts going on to terminate these leases for lack of production?  I'd appreciate any information on this topic.  Thanks, in advance.

Tags: Black, Chesapeake, Field, Lake, in, leases, paying, production, quantities, terminating

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I thought leases were held for 10 years beyond production or any attempt to produce. 

Lrb2brnot2b,

I think it is a servitude that extends for 10 years beyond the end of production or any attempt to produce.

 

My lease in the Black Lake Field says that the lease is valid as long as long as "oil, gas, or other minerals are produced from said lands or lands with which said land is pooled hereunder."

 

No "oil, gas, or other minerals" have been produced in 2011.  Does this constitute long enough to end the lease?

I am no expert but in the thread below this one they talked about how a drill bit could interrupt a prescription on land that has never been drilled before.  I took it that they were talking about holding a lease that was about to run out.  Maybe Les B  or Skip Peel  could answer what is going on here?
If memory serves, Black Lake Field production is covered under a "Field Wide Pooling Order".  I don't deal with fields that fall under the "stripper provisions" of the mineral code so I can't speak to any specifics.  I do suspect that there is a  reasonable cause of action based on production, or the lack thereof, but would leave that determination to a first rate, experienced O&G attorney.  Any mineral owners contemplating legal action against Chesapeake should do so with the certainty that it will be protracted and expensive.  That being said, any interested members should explore the possibility of class action status.  I would think there are many mineral owners that might qualify for the definition.  The question remains, how many would agree to participate and share in the cost of litigation?

Skip,

No doubt it would be a mess to try to terminate the leases.  CHK would fight this to the death.  On the other hand, 20,000 acres are being HBP, with no P.  I was just trying to find out if anyone has tested the waters yet.

They have one well with an oil pumping unit running on the south side of Black lake.  The gas from this well is burned at the well site and not treated and sold.  It will run for a few months and then be shut down for a few months.  All of the other wells with pumps in the field never run anymore, but their one well has been running steady for 2-3 months now.  They P&A a well every now and again and that's about the sum total of the activity in the field.  Always wondered why Chesapeake keeps it.
Highwayman, it could be the well is only pumping water now, or at least not enough oil in the water to recover.

Les,

You are right.  I am told the water trucks are coming and going constantly to that site.  Several trucks per day, sometimes.  Can you explain to me why they do this? 

Henry, as water drive oil fields reach the end of their life the water cut (% water in oil produced) increases to levels approaching 100%.  So you may produce 90+ barrels of water for every 10 barrels of oil.  Eventually the field just "waters out" or becomes uneconomic to produce. 

Les,

They had a workover rig at the location in March and since that time it has been pumping constantly and a flare has been burning.  I'm no expert, but if it was only pumping water, why keep it running?  Plus, I assume, any oil produced keeps the leases held in the entire field.

Highwayman,

Can you tell me, more specifically, where this location on the southern side of Black Lake is?  What is it near?  I want to make sure you and I are talking about the same site.

 

And I'm with you, if all they are pumping is water, what's the point?

 

 

Henry,

The well is located about 30 yards from the water on the south side of the Clear Lake part of Black Lake.  It is about 1/4 mile east of Morgan Bayou, if that helps.  I don't know the well name.

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