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Permalink Reply by Robert Duke on December 15, 2010 at 10:15

So somebody help me understand.  IF there were something deeper than the HA that had value, wouldn't we HA mineral owners have landmen dropping out of the sky all over them to get leases to hold the deeper interests (if I understand Pugh clause stuff - not a certainty)?  If it were shallower (which seems more likely, as there are these depth and temperature factors, but hey, what do I know), then wouldn't every company in the world, in punching down to the HA, have seen this opportunity in the corings as they went by?  And wouldn't CHK's leasehold be limited to what they currently have in the HA?  Not trying to be a killjoy, just trying to understand what the range of real possibilities is, and why and why not.  I am presuming that the talk about this possibly being in NW LA has to do with all the Smackover stuff, which I have not followed in great detail, as it seems to be more relevant up around the Arkansas border, and hear the seismic is occurring on the DeSoto - Natchitoches Parish border (not far from me, which is probably why I jumped in...)  (the Landman that handled my lease way back before HA was a widely known opportunity, when queried about what they were going after, mumbled "Smackover sands" - LOL - this was when Encana was wrapping up their leasehold at bargain basement prices because nobody knew what they had).

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Permalink Reply by Aubrey C. Sanders, Jr. on December 15, 2010 at 10:42

Robert,

 

Just an opinion based upon experience:  I would guess that most leases have NO PUGH CLAUSES. Therefore production at any depth  would hold lease for all depths unless otherwise limitted. I am a geologist, not landman so I don't know positively about the customary  practice in that area may be in regard to Pugh clauses. It would be very interesting if one of our land person members might speak to this.

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Permalink Reply by Robert Duke on December 15, 2010 at 12:06

Hi olddog,

No messenger shooting here; just an interesting conversation.  So, I would like to bounce this back to the geologists, like Aubrey, though.  Is there a reasonable possibility of pools, or "stones" of oil down below the HS layer - we are talking what - over 13,000 ft down in that area of the HS play?  I thought folks were pretty skeptical on this because the pressure and temp at those depths tend to crack organics to gas rather than oil, which is why the HS is a dry gas play.  Mind you, I would of course be thrilled to be sitting on a lake of oil as well as gas, given current pricing, but have not exactly rushed out and bought two new houses based on it ;-)  So I am looking here at possibilities, and prior to this discussion, I would have assigned this one a fraction of a %, but if they are truly running all over the place shooting seismics for oil, I presume they are not doing it for the exercise.  Is this the same thing as the Smackover, or the "brown dense"? (or are the two the same).  Anybody want to summarize the current thought on this stuff (a few key HS site contributers seemed just a bit skeptical, last time I looked...)

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Permalink Reply by essay on December 15, 2010 at 17:19

i know next to nothing about seismic testing, if the original shoots were looking for relatively deep shale, would they have necessarily picked up smallish isolated pockets of oil in the shallower strata?

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Permalink Reply by olddog573 on December 15, 2010 at 10:52

Like any good rumor this one not only has legs but it has grown a couple more to address questions such as yours.  The Haynesville is like a big carpet covering a certain geographical area.  The bossier is like a smaller carpet on top of the larger carpet.  Since the carpets are covering large areas, the payments for gas are figured on 640 acre sections. 

 

The oil is like stones under the HA carpet.  Since the stones don't cover a full 640 acre section like the carpet does, leasing will be only where the stones are located which will more than likely be 80 acre parcels.  The ongoing seismic activity being done now is to locate the stones or oil.  And last but not least, from a pretty good source, (doesnt everyone have one of those, LOL?) I heard that  a Petrohawk landman told him that lawyers have been looking over all leases trying to get around the pugh clauses wherever the stones or oil may be.  No good rumor explanation yet on how the oil exist at the depth it is and temp down there.

 

Don't shoot the messenger,  that's just what I've heard. Rumor has grown hasn't it? LOL.

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Permalink Reply by Rozzy on December 15, 2010 at 12:19

I am not sure, but the guy who was working with my family with Petro hawk was pulled from working with the Haynesville Shale and added to a new product they are working on… Might be a connection, maybe not…

 

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Permalink Reply by essay on December 15, 2010 at 17:21

North LA, 23.50-24.00 has been chk's ceiling for quite a while now.  the breakout's going to be big either way i'm guessing.

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Permalink Reply by The Shadow on December 15, 2010 at 16:09

CGG Veritas is also seismographing from above coushatta down the Red River towards Natchitoches parish.  Could they be looking for a number of things, such a pools of oil, faults, dips and salt domes or layers which usually have oil and gas deposits around or under the salt?  Just a thought.

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Permalink Reply by essay on December 15, 2010 at 17:08

the shadow knows.

 

i talked to one of their people today, seems to me that they're definitely looking for something a lot shallower than shale gas.

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Permalink Reply by Les Bamburg on December 15, 2010 at 17:31

Shadow, this is an industry survey primarily for optimizing the location of Haynesville Shale and Bossier Shale development wells.  This is a southward extension of the original Tri-Parish Survey shot by CGG Veritas.

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Permalink Reply by oil guy on December 16, 2010 at 6:08

Utica formation, Ohio

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Permalink Reply by North LA on December 16, 2010 at 8:12

Could be Utica shale, but that would be pretty weak on CHKs part as Utica is an established play and there are already several operators in the play. Could be why they bought out Anschutz though.

 

Here's a clip from an article on Utica shale.

 

"As many as 40 energy-company representatives file into Brown's office every day, he said, combing through property records and filing new leases. Energy companies have filed 600 new mineral-rights leases in Columbiana County Ohio this year. They filed 197 new leases in the same period last year."

 

Utica Shale Companies

 

 

Significant producers within the Utica Shale are:

• Altai Resources
• Equitable Resources
• Forest Oil
• Gastem
• Junex
• Questerre Energy
• Range Resources
• Talisman Energy

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