Replies to This Discussion

Permalink Reply by Gambler on May 20, 2010 at 11:17

Has anybody heard anything about the well in sec 4 t9 r11??

Permalink Reply by Steve Thibodeaux on May 21, 2010 at 16:02

I am in sec 6 in t9n r11w in pleasant hill.

Does anyone know if a well is being planned.

They seem to be drilling in sections all around me. Is there s reason why the are doing this.

Permalink Reply by Les Bamburg on May 21, 2010 at 17:41

Steve, much of Shell & EnCana's current drilling activity is based on lease expiration dates. It may be that your section does not have immediate lease expiration issues.

Permalink Reply by Steve Thibodeaux on May 30, 2010 at 3:38

Lease expires i 7-2010 with a 2 year option.

Hope they forget

Permalink Reply by Donna Thornton on June 2, 2010 at 4:36

Highly unlikely Steve. We also signed July of 2007. They moved a rig in on Monday, May 24th. We signed when it was dirt cheap for 3 years with a 2 year extension option. Taking my certified notice with me down to the post office today to pick up my option check. I guess since the well is not producing as of yet, they have to renew by exercising the option.

Permalink Reply by waltcop on June 2, 2010 at 5:29

Donna,
That raises a very important question......does a well have to be "in production" before the lease expiration date or "spud" to hold a lease? I think several mineral owners in and around Mitchell and Pleasant Hill will be facing this issue within the next few months.
Les B, do you know when the legal expiration date is in a case like Donna's?

Permalink Reply by Donna Thornton on June 2, 2010 at 7:07

I will have to go back to my lease papers to get it exact. But, from what I remember, the well has to be producing and if they are going to exercise the option, the property owners are to be paid 60 (???) days before lease expiration. Looking at my check, this seems right. My check stub is saying the lease is from 7/12/2010 to 7/12/2012 and the check is cut on 5/06/2010.

Permalink Reply by Les Bamburg on June 2, 2010 at 15:01

Waltcop, a well has to be in gas production to hold a lease long term after the lease expiration date.

Most lease agreements include a provision that covers the situation of a well being drilled at the lease expiration date. The provision basically extends the lease for 90 days from the completion date of the well. There are also references to continuous operations. So my interpretation is the operator has some limited period of time after drilling the well to frac and complete the well if after lease expiration.

Finally, if the operator has a well capable of producing "in paying quantities" but is waiting on a pipeline or treating facilities, the lease will remain in effect.

Of course the operator can utilize the extension option if available. My discussion above relates to the situation when the extension option is not available.

Permalink Reply by waltcop on June 2, 2010 at 16:27

Thanks Les B, I appreciate your help.

Permalink Reply by Pelican on May 25, 2010 at 10:25

When does you lease expire?

Permalink Reply by Just Interested on May 23, 2010 at 7:03

I have 41 unleased acres in sec 16 T8 R12 (Near Zwolle). They have leased all around us. Have they stopped leasing in this area?

Permalink Reply by ken hatcher on May 23, 2010 at 8:53

J I, I cannot answer your question but can tell you there is still some activity W/SW of Zwolle.

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