Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on June 20, 2009 at 9:33

Thanks, Jay. Why would companies use the varying designations for the HA zone in their unit applications?

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Permalink Reply by Les Bamburg on June 20, 2009 at 11:40

Skip, as Jay said there is no difference in HA RA, HA RB, HA RC, etc. The selection is arbitrary by the operator as the defined zone is essentially the same with the exception of using a different well log for reference. In some cases different operators in the same field will use different reservoir designations (ie HA RA -vs- HA RB). It is not related to running out of letters as some times an operator will start almost immediately with HA RB in a field. Also, the operators just switch to three digit numbers when they run out of single and double letter designations. By the way, the Bossier Shale is included with the Haynesville Shale in the HA Zone designation.

JUR RA is different than HA RA because it typically covers a slightly wider depth range and would include the Smackover Formation along with Haynesville/Bossier.

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Permalink Reply by Skip Peel - Mineral Consultant on June 20, 2009 at 11:53

Thanks, Les. As other reservoir designations seem to imply a number of associated but separate geologic formations or zones (CV and Hoss), it is easy to see how a layman might infer the same distinction for the Haynesville reservoir. The Jur (Jurassic) designation was used early in the play by a small number of companies all of whom have changed to HA. I would appreciate your opinion, if you would care to give it, on the second question. Is there a continuing effort by unit applicants to change the definition of formations (not just the HA) by depth in order to expand the coverage of their existing leases?

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Permalink Reply by Les Bamburg on June 20, 2009 at 12:03

Skip, I have not seen any instances.

Keep in mind that units can be established for a specific formation or sand or for a zone. The first two are based on geology while the zone is an operator defined interval. So a zone is not the same as a formation in regards to the unitization process.

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Permalink Reply by Les Bamburg on June 20, 2009 at 12:15

KB, a formation such as the Cotton Valley or Hosston is clearly defined and known. When a well log is being interpreted, these formations are recognizable.

A zone is not tied to a specific formation - it is defined by the operator and can include more than one formation or sand or shale. That is the reason EnCana & Shell initially utilized the JUR designation for Jurassic which is a geologic time period rather than a specific formation. They could have just as easily defined the interval as the ABC Zone. Then the first unit would have been ABC RA SUA.

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Permalink Reply by Skip Peel - Mineral Consultant on June 21, 2009 at 2:43

Les. There has been some speculation on the site regarding operators purposely and maliciously mis-defining formations in order to cheat mineral owners. And not just the Haynesville but other formations in portions of north LA. not considered to be included in the HA Play. I see no evidence to support this speculation and merely wish to place on the record some opposing opinions. Thanks for providing yours.

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Permalink Reply by Skip Peel - Mineral Consultant on June 21, 2009 at 3:31

Thanks for providing the link, KB. It seems like yesterday but it's almost been a year ago.

Permalink Reply by Skip Peel - Mineral Consultant on June 21, 2009 at 3:26

That's how I recall it, Jay. A small number of D&P unit applications by a few operators in one field. Unfortunately, those instances have been used to support a conspiracy theory that purports the practice to be wide-spread and on-going across the breadth of N. LA.

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Permalink Reply by Skip Peel - Mineral Consultant on June 20, 2009 at 12:07

Les, Do you see any reason for land/mineral owners to be concerned about the way operators are defining zones?

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Permalink Reply by BirdDawg, plain ole' idiot on June 20, 2009 at 12:54

I really do not think there is any kind of conspiracy here in the designations.

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Permalink Reply by Skip Peel - Mineral Consultant on June 21, 2009 at 8:30

BD. I agree. However it's just too good an opportunity to bash the industry and foster doubt and distrust in mineral owners for some to admit the facts. Especially when their skewed analysis of development activity is built on these two issues. It is prudent for the members to have access to dissenting opinions. I think they are quite capable of deciding if the comments and opinions of the industry members are accurate or some clandestine cooperative attempt to rob mineral owners.

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Permalink Reply by Les Bamburg on June 21, 2009 at 3:28

Jim, actually the application for the Redoak Lake Field Haynesville unit appears to exclude the Smackover Formation based on the depths specified. This would be consistent with the Commission's guidance.

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