Replies to This Discussion

Permalink Reply by Bobi Carr ("parker") on October 5, 2008 at 5:41

What are the STR for each of them?

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Permalink Reply by Spring Branch,mineral owner on October 6, 2008 at 3:17

What is the reason for the formation of Encore's units in your opinion, Jay? I sure don't like them at all.

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Permalink Reply by Skip Peel - Mineral Consultant on October 5, 2008 at 12:08

de nada, the Metcalf Field is just north and east of Johnson Branch. They are adjacent. Chesapeake's June 10 HA RA unit application covered mineral acres in both fields.

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Permalink Reply by Spring Branch,mineral owner on October 6, 2008 at 3:13

The units clearly overlap. Looks like we may have a fight on our hands between Chesapeake and Encore. Chesapeake's unit is larger than 640 acres only because it is on the Texas border and the majority of Section 7 is in Texas. Encore's units incorporate the north portion of one section and the southern portion of another section to form a unit. In other words they are forming units which are not based on Section boundaries. For us common folk, I see no good reason to get that practice started; as all it does is muddy up the water and make it more difficult for us mineral owners to follow what is happening and where. I can't imagine that there is a good geological reason for the formation of Encore's units, it probably has more to do with where their leases are located. What do you think, Shale Geo?

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Permalink Reply by mary on October 14, 2008 at 7:00

Revolt we must. The Commissioner is already siding with the oil companies without proper input from the public. Write to Bobby Jindal, Commissioner Welsh and your Senators.

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Permalink Reply by Lee on October 6, 2008 at 6:50

Yes, there are 6 sections against the TX-LA line that are proposed to be 920+ acres. There was a public hearing held in Baton Rouge on Sept. 16 to consider Encore's application for the 6 units. The decision was to be made by the commmssioner by Oct. 15th.

Yes, this is not good for the landowner (your royalty is further diluted) unless you get more wells drilled in the big unit than you would have had in the 640/720 acre unit.

What is this really all about? Encore/Chesapeake being able to hold more acreage HBP due to larger unit size.

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Permalink Reply by mary on October 18, 2008 at 5:40

I have spoken to many people in the oil/gas business over the last week and this is NOT an effort just on the Tx border. The plan is to increase ALL Haynesville Shale units to over 900 acres and that will dilute your interest. This initial effort, upon approval by the Commissioner, will set a precedent for all future applications regarding ALL property in the HS.

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Permalink Reply by ez on October 18, 2008 at 6:05

sounds like to me that people need to start making sure that they dont sign a lease unless that claus is in it. i know i wont. all there doing is making your royalties less by pooling and once again its better for the oil and gas company and not the property owner. the leases that come from the oil and gas company are from the 1940's and are all for them what else would we expect thats why there putting all that bonus money in your face to try to get you to sign that crap. i think people are starting to get smarter and more educated so hopefully this may put a stop to some of there tricks. you can bet if you hand them a lease there going over it with a fine tooth and comb ther not going to just sign on the x like they hope you will.

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Permalink Reply by mary on October 18, 2008 at 12:19

The problem here is that I don't think it will matter what you do or don't sign. This is a move that would be approved by Commissioner Welsh forcing ALL sections to combine to become at least 900 + acres in size, regardless of what your lease stipulates. This is independent of an agreement with the oil company. ..a mandate from the state office of conservation.

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Permalink Reply by Snake Stewart on October 18, 2008 at 10:18

You are spot on Lee. The main issue with having more wells in your unit,IMO, is that there wouldnt be any more gas royalty because it would be dilluted among many others. 3 times to be exact in CHPK lease.
Some leases that I have seen have 1920 acres in there wording. If you sign that lease it doesnt have to go to DOC for unitization because a unit can be formed voluntarily if I'm not mistaken. When this happens they can drill one well and hold three sections by production for as long as they need to.
This has absolutly nothing to do with drainage of the unit. It is about their bottom line and HBP.If you sign that type of lease you have no say over it what so ever.

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Permalink Reply by JOHN on October 6, 2008 at 8:40

I think Ya'll are reading too much into it. You want it all to go your way and sometime like when it comes up against a stateline the units take in or they give up acreage. The state is not laid out in a square, so you are going to have give and take. The Hosston and Cotton Valley is set up in the Exact same way. This happens along the Arkansas line as it does against the Texas and Mississippi state lines. Down south you have Sections like you have never seen before, all because of the rivers and such. Did ya'll know that most of North Louisiana used to be Claiborne Parish until the divied it up to form the current parishes? Research the land you live on and understand what is going on so you don't make statements so one sided. Oh, BTW one of those plats...there is no R17W in Texas! John

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Permalink Reply by Grice on October 6, 2008 at 9:05

I agree. The expansion of a unit is not done to "cheat" the landowners, but as a means to effectively include areas which may otherwise have been passed over. This is a give-and-take situation where the landowners in a 640 acre section will "give" a percentage of their royalties (640 acres), in exchange, the landowner will "take" proceeds from the additional acreage (920 acres).

The acquisition of the land could be divided into several applications, but it is more cost efficient to simply add the smaller section in with the larger sections. There may be other factors in increasing a unit size, but I do not see such action as being devious or misleading to the landowners.

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