Are the big O&G players running out of capital?
I heard today that some of the big players i.e. Chesapeake, were running out of capital because of leasing up so much acreage in the area and that they were going to stop leasing and start drilling to raise capital. The person I was talking with said they were told that it would be after the first of the year before they would get their leasing bonus.
Anyone else hear anything like this?
Anyone else hear anything like this?
Views: 278
Replies to This Discussion
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Permalink Reply by Two Dogs, Pirate on -
You are correct Duncan, I have been putting the word out to save your shallow rights since I found out about this shale play. How did the last whitewater trip go?
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Permalink Reply by Two Dogs, Pirate on
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KB, in the area that I have been working they don't seem to have a problem cutting out the shallow rights. It may be the group working the area your in thats trying to play hard ball.
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Permalink Reply by Aubrey C. Sanders, Jr. on
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Certainly if the Haynesville Shale is their target most will not hold out for other rights.
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Permalink Reply by Dion Warr, CPL on
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KB:
It's not difficult, if you know what you're looking for, and you're persistent.
I would suggest checking your twn-rng in SONRIS. Chances are that a well if sufficient depth (say, the Hosston or Cotton Valley) has been drilled nearby. Look at the well file for that well serial number (or those numbers) for the well completion report. The flipside of the sheet (or next page) usually contains commentary on "paleologic or geographic formations encountered". The tops of formations encountered in the well are reported there.
If that doesn't pan out, the unit orders usually do report the approved unitized interval. If you're worried about "fast and loose" definitions, just use the interval (footage) as originally reported in the orders, prior to any redefinitions. This issue has made it more difficult, as well as the fact that while in some fields, unitization has occurred at the Haynesville, while in others, unitization has been at the "Jurassic Zone", which is usually a much more broad definition and contains a few intervals (Bossier and Haynesville, as well as portions of the Lower Cotton Valley, in some instances).
If this is confusing, you could always pull an existing well log on file, get it to a geologist (like Jay), and ask him, "based upon this well log, where would you say the top of the Hosston (or other formation) is?"
More importantly, use a well as nearby to your property as possible, and in the same field. It's kind of useless to use a Caspiana Field strata definition if you're property is square in the middle of Elm Grove.
But you're right, saying that "this lease is limited to strata below the top of the Hosston Formation" is vague when companies are constantly redefining the Hosston. It would be much better to say "this lease covers only those strata lying at or below the stratigraphic equivalent of 7,063' as seen in the XYZ #1 well, located in Sec. x, T17N-R13W, Bossier Parish."
One last point: companies typically want to have the right to develop your lease as many target formations as possible, not just to hold your lease, but if they bypass some pay at the Pettet or the Hosston or the Cotton Valley on their way down to the HS, and they spend oodles to do it, they would rather have the ability to plug back to the producible strata and at least limit their losses. A stratigraphic Pugh clause (NOT the one saying 'capable of being produced') can give Lessee the time to drill and evaluate the well prior to the lease period running.
That being said, Chesapeake is probably not interested in producing from the Fredericksburg. But plenty of 'Mom and Pops' might like to. Good luck.
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Permalink Reply by Duncan McGehee on
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Great. The heat was brutal and the mosquitos worse, but when the bats came out - insect activity ceased. After 4 or 5 days the insects disappeared. Ran my first solid Class III rapid. Got the trip on film until battery went south. We'll put that up on paddleon.net when we get all the editing etc done.
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Permalink Reply by po boy on
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Duncan, checked your site www. landmen.net interesting and informative ,but I did not see a blag option.
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This is great advice. After all, the big operators are not interested in your shallow rights. They will include them in lease and MAYBE farm them out to some small operators. And maybe they will not, in which case no one benefits, most especially the landowner.
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Permalink Reply by Snake Stewart on
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If you were talking to me Mr. Duncan I wasn't being sarcastic nor do I claim to be anything but a megaphone against the unkind things that have happened in my area in the last 2 years. Thanks for finally coming on board after all this time and sharing some much needed wisdom with us , as I was running out of material. That last sentence was sarcastic on my part.
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Permalink Reply by Hamp Moody on
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Where is Chesapeake's core area?
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Permalink Reply by Gone Fishin on
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Great idea. I think we need to start a new discussion on this one. I'll go ahead and get it going.
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Permalink Reply by easttexas12 on
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I'd like to see CHK sell their Fayettville Shale to China (very shrewd). China will export that gas back home to China or to Europe where NG is over twice our going rate, instead of driving down our NG prices with more supply. The coal fired power plants in China ain't cutting it for their future.
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