Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on October 27, 2010 at 5:39

Mainland's MO is to tout anything and everything. That has been the case throughout their short history. My question for locals or those with remote accounts to the County Clerk of Court records would be, Is Mainland still recording leases? If so, how many and how recent? Is there leasing activity by others? I'd consider that more interesting information than applications for inactive well status.

Permalink Reply by Paul M. Hess on October 27, 2010 at 6:11

A good point about leasing activity, Skip! It would be interesting to hear what the locals have to say! As you are a landman, do you have any contacts who might have info in the immediate area as to activity at the county clerks office?

I would suspect that any prudent operator would have all acreage pertinent to any particular prospect leased, or at worst, under negotiation if held by others. Mainland reportedly acquired another 1200 or so acres "near" the Buena Vista prospect. Whether it is on the same feature as Buena Vista, or a small offset anomaly is anyones guess. Activity will depend on "open" acreage. As I understand it, activity on acreage under lease by others would be known only when a farmout is recorded. JOA's when announced.

Permalink Reply by Skip Peel - Mineral Consultant on October 27, 2010 at 6:17

No, Paul. I was hoping that we had one or more members who live in the vicinity of the well. From the get go Mainland has touted this exploratory well as a "Haynesville Shale" well. If shale is their target, IMO they would have a lot more than 1200 acres under lease. I suspect that Mainland used the term, Haynesville Shale, merely as a way to attract attention. And hopefully, investors or a JV partner. 12,000 acres wouldn't make a respectable shale leasehold.

Permalink Reply by rusell shleby on October 27, 2010 at 6:25

I very good friend who has been in the court house in Fayette in the past few weeks. It is a older small courhouse, and it is wall to wall. Clarke, Adams, and Wilkinson have all had landmen in them everytime he has visited. We have been able to obtain a few leases, most all people have been contacted in the past 6 months.

As of this morning Mainland has drilled another 80 feet 80% sand 20% shale.

Permalink Reply by Paul M. Hess on October 27, 2010 at 7:20

Rusel, sounds as if you have access to some good info. I will look forward to your posts as drilling progresses!

Permalink Reply by Paul M. Hess on October 27, 2010 at 7:31

While 20 square miles may not seem like a lot for a shale play in this basin, it may be all Mainland(MN) was after at this time. It is my understanding that the prospect is on a structural anomaly. That anomaly may be less than the acreage they have in this project. Not all equivalent shale in a "shale" play will be equally productive across the basin. Organic content, thermal maturity, silt and sand contents will add great variability to the commercial productive, and reserve, capacity of a well. Structure will add to for it provides for shallower trapping potential as a back up. Plus, well compacted shaled draped over a structure may develop macro, or micro fractures which will add to hydrocarbon reserve and producibility. If I were MN, while others are trying to lease and snuggle up to my acreage, I would have my geologists pinpointing similar anomalies within the basin, especially along the basins structural trends, to go after in the event the well is a hit!

Permalink Reply by Skip Peel - Mineral Consultant on October 27, 2010 at 7:47

Spoken like a geologist, Paul. LOL! As a landman I would think that ML would be following the model of the shale companies in the Haynesville Play. Snap up all the cheap leasehold you can get, even if some turns out not to be economic, and convey a portion in exchange for development capital or, in ML's case, a capable operating partner. Have I mentioned lately that ML drilled zero wells in Louisiana?

Permalink Reply by rusell shleby on October 27, 2010 at 7:55

Time will tell.....

Permalink Reply by Skip Peel - Mineral Consultant on October 27, 2010 at 8:00

Times almost up.

Permalink Reply by Paul M. Hess on October 27, 2010 at 11:25

That's me! I have enjoyed the discussion. Interesting to get into the take from anothers viewpoint!

Permalink Reply by Skip Peel - Mineral Consultant on October 27, 2010 at 12:12

I am reminded of the old saying, "Even a blind hog finds an acorn now and then". I would like for Mainland to find some prospect(s) of value. Obviously those who would stand to benefit in a number of ways feel the same. I just do not see any reason to be overly optimistic considering the available information. Since TD appears to be in the not too distant future, I would throw this comment out for consideration. This is an exploratory well. If it is completed at all it will likely be "up hole" in a relatively shallow and less challenging formation. Upon completion all we will have to go on is Mainland's report on what they claim to have found. IMO, Mainland is incapable of a horizontal completion at the depths anticipated for the "Haynesville" formation if it is indeed shale. It will be interesting to see the level of interest that may be generated from their proprietary data. However if the prospective formation(s) are "dry" gas, it is quite possible that there will be little interest by majors in a time of a natural gas supply glut. From an industry stand point, there is already too much dry shale gas. And every new discovery is of diminished value.

Permalink Reply by Dennis Dion on October 27, 2010 at 14:52

Skip, you are maybe a good landman but you are not a geologist. Mainland's team of geologists and shale drilling experts were unanimous in calling this well a low risk undertaking. They actually bet the farm with this shale prospect. If you believe that dry gas reserves are of no interest for major players I think that you should sell your MNLU shares and find better investment opportunities

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