Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on March 3, 2010 at 6:19

Kevin. I do not remember a recent site discussion on F&D costs. After a period of decreasing drilling costs, the increase in development activity in the HS and other plays is reversing that trend. And the break-even cost varies significantly by operator. Some like Chesapeake and EXCO have partners providing drilling carries for a substantial portion of the cost. F&D costs are often included in corporate reports and conference calls which can be accessed on their websites.

• ▶ Reply

Permalink Reply by ken hatcher on March 3, 2010 at 10:30

P.t. Barnum summarized it best.

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on March 3, 2010 at 11:07

Here is an example of the unit applications I am seeing increase.

http://dnr.louisiana.gov/cons/CONSEREN/hearings/2010/04APR/10-373ap...

• ▶ Reply

Permalink Reply by I aqree on March 3, 2010 at 12:44

So what fringe areas in the north will be the most productive? T-19N,T-20N, etc. Around the belleuve oil fields would oil or "wet" be more likely,why? IMO people in my area of north bossier that are on the fringe and didn't get leased will be willing to listen to offers.

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on March 3, 2010 at 12:57

I agree. I don't know. For sure. If you will allow me a guess, I am just an independent landman, here is what I see. After the major shale players, Chesapeake and Petrohawk, drilled a few wells in north Caddo and north Bossier, they shifted their focus south and east. I can not say that the Shale in the far northeast corner of the play, 20N-11W & 19N-11W is any better or worse than that in 20N -16 or 15 W. After the attention of operators and observers turned south, Devon Energy quietly began leasing in far north Caddo and Bossier along the river. Then they formed units for CV, HA and SMK in 20N -14W. Devon is one of THE best operators around and they have an abundance of horizontal drilling and completion experience. They see something of interest in those areas I just don't think that the HS is their main interest. As to what is better, 20N or 19N, for the shale 19N especially the far south sections.

• ▶ Reply

Permalink Reply by Charles McDonald on March 3, 2010 at 13:13

IN southern Lafayette county, just north of the Springhill state line, I had a Smackover well of Gas and Condensate for 9 years beginning around 1981. Once it was abandoned, the Oil Company tried to make a well in the Haynesville zone but did not get commercial production with a straight well bore. There are a lot of fault zones that run across the south arkansas north LA area around there, so I would expect wells to be somewhat more independent than less fractured area structures. My guess is that some oil companies would be to leaseing at low $ and percentages with unrestricted zones to get some production and hold the lease for the Shale gas opportunities as the field and pipelines are expanded and developed?

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on March 3, 2010 at 13:29

Charles. The Haynesville formation in the area you mention is not shale. It is sand. And there are numerous Haynesville Sand wells some over thirty years old all along the state line in this part of North LA.. There is no benefit to drilling horizontals in the sand. Where the Haynesville Sand is found to be productive, vertical wellbores are the most efficient and economic way to produce.

• ▶ Reply

Permalink Reply by Glenn Taylor on March 4, 2010 at 3:26

Skip:

You started quite a discussion, one that has a lot of good information. I contacted a friend of mine who owns one of these "small" O/G companies about the possibility of my property being in the Haynesville Shale area. He had his geologist take a look and I was told that the possibility exists but that my friend's company wasn't in the position to take any action because of the depth of the Haynesville Shale. In other words, his company is one of those that deals with shallower exploration. The point here is that I feel you guys are right on with your analysis of what is happening with the permits. These smaller companies need to make money and the smart way for them to profit is to stay in their field of expertise. Also, the profitability of oil and "wet" gas has a bearing on wht these guys are thinking.

I am sure that the mindset of everyone, including me, is that their mineral rights are worth a lot more today than they were before the Haynesville play came into the picture. Whether this holds true is to be seen.

Another thought I have is what the activity of the drilling and production has on the community? Roads are deteriorating from all of the heavy trucks, pipelines are crossing property, ponds are being drained. At the moment I have a very quiet secluded home that I enjoy very much. Do I really want all of the activity that is happening with the Haynesvile play? Is the money worth the trouble? I would really like to be a part of the group who is reaping the benefits of the present boom but then I really like my solitude too. This is quite perplexing.

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on March 4, 2010 at 3:40

Glenn. IMO, ALL Oil, Gas & Mineral leases should contain vertical Pugh clauses regardless of the formation that is targeted. And if a lessor is getting a quarter royalty, I see no problem with allowing a lessee to drill away as deep as they care to go. Remember it's not how deep they drill, it's their deepest "production" that establishes what the lease covers after expiration of the primary term. If a lessee does not wish to offer a quarter royalty, I would add additional depth restrictions if my mineral tract was sufficiently large to warrant. I consider this a good point to state that I do not take leases. Never have. That always surprises some members because in their minds that's all landmen do. Landmen perform numerous functions besides offering leases. I have provided research and suggestions to mineral owners regarding their negotiations to lease and I provide referrals for those who need additional professional services. I have never worked for an "oil and gas" company in my life.
Furthermore, my business is limited to the Haynesville Shale. I do not work in areas outside the defined boundaries of that play so I do not have any inside information from a geographic or industry stand point in the areas that I had in mind when I started this discussion thread.

• ▶ Reply

Permalink Reply by Glenn Taylor on March 4, 2010 at 3:51

Skip;

My comments were not directed at you. They were meant to relay information that I had gained from contacting my friend who is in the O/G business and to give my thoughts on the question of mineral lease payments. Maybe you misunderstood what I was saying. I wasn't attacking you. Pllease re-read my comments and let me know if they are offensive to you.

Glenn

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on March 4, 2010 at 3:59

Glenn. No, I didn't think you were attacking me. I apologize if I gave that impression. There are a lot of new members who have never read archived discussions and therefore have no previous knowledge of the regular posters on the site. When I post my opinions concerning leasing it is not unusual to get comments that I am attempting to manipulate the opinions of mineral owners so that they can be "taken advantage of". That comes from those who know only negative things about landmen. There are a number of landmen on GHS who provide accurate content and do not "talk down" to land/mineral owners. For those who remain active for a sufficient time, you will see The Baron, Checkmateking, Les B. and others too numerous to mention refute attempts to post erroneous information by members who may have an agenda or just wish to worry mineral owners. They come around from time to time but generally do not stay too long when they realize that knowledgeable members, usually industry members, call their bluff and expose their inaccurate information or analysis. Please keep in mind that even though you and I have been involved in a specific discussion, this is a thread that started quite a few posts back and may go on for quite a few more. My previous post is intended for all those members reading the thread in its entirety or at least enough to provide context.

• ▶ Reply

Permalink Reply by Glenn Taylor on March 4, 2010 at 4:15

Skip:

Again, I would ask you to re-read my comments. Nothing I said was negative it was just information that I had gained and comments about the price of leasing, hoping it would be beneficial. I really hope you are confusing my comments with those of someone else. Please tell me specifically what was inaccurate about my comments.

Glenn

• ▶ Reply

• ‹ Previous
• 1
• 2
• 3
• 4
• Next ›
• Page