I am looking for some guidance. 

Recently we have received several notices from a law firm that represents Chesapeake Operating, LLC.  The letters are copies of letters to the Commissioner of Conservation.  The notices notify the Commission of an application to drill a cross unit well.  The application comes with map of the units and the proposed well direction. 

But it is not crossing the land I own with family.  In its in the neighborhood, but not our land.

Question 1: Is this SOP pursuant to some LA statute or regulation for land that is close by to get such a notice?

Question 2: Is this in any way predictive of a similar possibility for the land I do own?  

As I say, the proposed is close by our land, just not on it yet.

Any insights would be greatly appreciated.  Still trying to get a handle on all of this...

Tags: New drilling, alternate, cross unit, drilling, lateral

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Louisiana law requires operators to provide notice to both mineral owners within the affected unit as well as mineral owners in adjoining Sections.

Unless the cross-unit wells turn out to be less than expected, having new wells drilled near your land is a good sign.  At this point, most of the operators are fairly familiar with the area, so there should not be too many surprises.

Notice is required to all mineral and surface interests of record within the unit boundary and adjoining to a distance of 1000'.  Cross Unit Lateral wells are designated by HC at the end of their name.  Many horizontal operators are now permitting HC wells wherever they own drilling rights in adjoining north/south sections.  HC wells are being drilled in the Haynesville (HA), the Cotton Valley (CV) and the Hosston (HO).  HA is an unconventional reservoir and HC wells are becoming the norm.  CV and HO are conventional reservoirs and horizontal wells are only drilled in areas of low permeability.  Where both formations exhibit high permeability operators drill vertical wells.

Thanks very much for the information.  It is most appreciated.  

What is the starting point and ending point for measuring the 1000 feet?  

Starting from the unit boundary, 1000' perpendicular.

Thanks for replying and the insights.

Skip, you have probably provided this before, but can you provide the language in Office of Conservation Order number 1145-B-55, which I think deals with the proration of interests in cross unit laterals?

Thank you!

5.     That unit production from said cross unit horizontal alternate unit wells should be allocated to each unit in the same proportion as the perforated length of the lateral, as defined in the DEFINITIONS section herein, in that each unit bears to the total length of the perforated lateral, as determined by an "as drilled" survey performed after the cross unit wells are drilled and completed; and that unit production should continue to be share on a surface acreage basis.

You're welcome.

I am getting the same thing in SEC 19 14 14, will that mean any pay for us? LOL

James, S19-14N-14W is listed as an Encana unit and they haven't been drilling wells for some time.  Did you get a notice letter from Encana?  Or did you get a notice letter for an adjoining section by an operator other than Encana?

Hey James tell us more about what letter you got in the mail. I am in 19 and could use some good news also . Lol. Maybe somebody will at least refrack our well because its low on production and it seems like every six months they reduce the production. Heck I don't mind any company coming to refrack and recrack the well, just get that sucker going again lol. I actually feel hopeful that maybe something may happen this year. Maybe someone else can give some input on section 19 holly field . Thanks to all that can reply and have a nice day. Ken

I have small amounts of minerals in sec. 18 and sec. 7 of 14/14 Holly Field. Sec. 18 was refracked by EnCana last May & production has been a little better.  Just wish they would move back into the Holly Field. EnCana is the Operator for sections 6,7,17,18,19 of 14/14  so lots of area there for CULs.


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