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Permalink Reply by Skip Peel - Mineral Consultant on June 7, 2010 at 9:58

Agreed. Alternate unit well apps have been increasing in frequency but this is the first time I have seen ten in a row by the same operator. Jay, I take it by your comment regarding British Gas that EXCO may follow up these alternate unit well orders with well permit applications rather quickly. If so, there must be a very robust gathering system in place to accommodate flush production from that many wells.

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Permalink Reply by Skip Peel - Mineral Consultant on June 7, 2010 at 11:16

From the June 15 hearing schedule:

10-728 KINGSTON FIELD Hearing Notice
Application
10-729 KINGSTON FIELD Hearing Notice
Application
10-730 KINGSTON FIELD Hearing Notice
Application
10-731 KINGSTON FIELD Hearing Notice
Application
10-732 KINGSTON FIELD Hearing Notice
Application
10-733 CASPIANA FIELD Hearing Notice
Application

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Permalink Reply by Mattie on June 8, 2010 at 2:47

What would be driving this 'big need' for gas now for British Gas? Are they under some firm delivery requirement to deliver gas into one of the No. LA pipelines? Even so, BG could always purchase pool gas to cover any shorts.

Please explain.

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Permalink Reply by Big Daddy, bcnr on June 7, 2010 at 15:55

Skip and Jay, I received most of those notices you posted. Oddly enough, this is the second time I received notices for 8 wells per section. The first wave was amended to 4 wells and now these. Are you guys thinking they are actually going to permit all of these wells? Don't well permits expire in 6 months? I know they can get another permit by cutting another check but is this physically possible to get that many rigs in there?

Also, what the heck is this? A super pad?



http://dnr.louisiana.gov/cons/CONSEREN/hearings/2010/06JUN/10-685ap...

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Permalink Reply by The_Baron on June 8, 2010 at 2:58

"gas factory" is a term created by encana to describe the direction drilling of many wells from one pad to shared facilities. They are using this extensivly in Colorado.

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Permalink Reply by Skip Peel - Mineral Consultant on June 8, 2010 at 1:31

Big Daddy, I'm not sure if I examined the plats on 100% of the applications but if not I didn't miss many. All were separate surface locations so I do not think they are a "gas factory" or a similar design. The LOC started offering a twelve month drilling permit about a year ago. As with units, alternate unit wells do not have a time line for permitting/drilling so that's why I was interested in Jay's comment that EXCO could very well be planning to drill everyone of these wells on a continuous drilling schedule beginning in the near future. Other than drilling out the whole unit at depressed gas prices, the first thing that popped into my head was the pipeline capacity to accommodate that much flush production. Not just at the field level but at the long distance transmission level.

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Permalink Reply by Skip Peel - Mineral Consultant on June 8, 2010 at 1:43

Yes, BD. That would qualify as a super pad. The other units I reviewed were separate surface locations.

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Permalink Reply by The_Baron on June 8, 2010 at 2:59

They will get approval for the alternate unit wells long before they permit the well.

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