For Whom The Well Tolls
“No man is an island, entire of itself” begins the poem “For Whom The Bell Tolls,” but landowners atop the Haynesville Shale may not enjoy the discrimination they’ll find in drilling units. Louisiana state law requires our Commissioner of Conservation to prescribe units that can be drained by one well. Haynesville units being created, however, often will require more than one well and do not conform to state law. That leaves landowners vulnerable to discrimination as there is often unfair apportionment of drilling and production. With the drilling of each well, more and more property rights are affected, putting more and more investments at risk. If not corrected, this will expose oil companies and Louisiana to relentless damage lawsuits. It is critical for Louisiana to enact a new type of compulsory unit specifically for the Haynesville Shale that will provide equal protection for property owners.
Our Governor is informed of the situation but has not taken action. At present, one landowner may have a well and experience all surface damage and gas drainage in a unit yet his income may be divided with others whose gas bearing land will never be drained. If his lessee has better terms in another unit, those owners may prosper with many wells while he is stuck with one. The possibilities for discrimination are endless. The average citizen is unaware that companies have been crossing the line or that our state has been content to let them. Attorneys for our state argue that the Commissioner has the broad authority to make any reasonable rules, but we contend that violating state law is not reasonable! Highly respected Tulane law professor, Luther McDougal, studied this issue, and was described by his colleagues as a leader, “speaking only when he has something to say and only when something needs to be said. His judgment and opinions are respected by his colleagues. We know he is a man of honor, integrity, high standards and common sense. There is no hidden agenda. There is no ‘what’s in it for me.’” McDougal concluded that once a producing well is located on the drilling unit, the unit is a developed area, and no other well can be drilled on the unit. The Louisiana Supreme Court has ruled that the only restriction on the Commissioner in establishing drilling units is that “such an order be reasonable and unit prescribed must not exceed the maximum area which one well can efficiently and economically drain.”
It is unconscionable to ask Chesapeake Energy and the other companies to play guessing games with our state on the legality and future of these enormously expensive wells. A new type of compulsory unit is needed that will allow multi-well, 640-acre shale units, while providing equal protection for property owners. In order to turn this area into an economic oasis and maximize gas production, we must first provide a firm legislative foundation for future drilling. The time for inaction is over. The clock is ticking. So, property owners, exploration companies, and the State of Louisiana, do not ask for whom the well tolls. It tolls for all of us. (For details email: fairdrilling@aol.com)
Our Governor is informed of the situation but has not taken action. At present, one landowner may have a well and experience all surface damage and gas drainage in a unit yet his income may be divided with others whose gas bearing land will never be drained. If his lessee has better terms in another unit, those owners may prosper with many wells while he is stuck with one. The possibilities for discrimination are endless. The average citizen is unaware that companies have been crossing the line or that our state has been content to let them. Attorneys for our state argue that the Commissioner has the broad authority to make any reasonable rules, but we contend that violating state law is not reasonable! Highly respected Tulane law professor, Luther McDougal, studied this issue, and was described by his colleagues as a leader, “speaking only when he has something to say and only when something needs to be said. His judgment and opinions are respected by his colleagues. We know he is a man of honor, integrity, high standards and common sense. There is no hidden agenda. There is no ‘what’s in it for me.’” McDougal concluded that once a producing well is located on the drilling unit, the unit is a developed area, and no other well can be drilled on the unit. The Louisiana Supreme Court has ruled that the only restriction on the Commissioner in establishing drilling units is that “such an order be reasonable and unit prescribed must not exceed the maximum area which one well can efficiently and economically drain.”
It is unconscionable to ask Chesapeake Energy and the other companies to play guessing games with our state on the legality and future of these enormously expensive wells. A new type of compulsory unit is needed that will allow multi-well, 640-acre shale units, while providing equal protection for property owners. In order to turn this area into an economic oasis and maximize gas production, we must first provide a firm legislative foundation for future drilling. The time for inaction is over. The clock is ticking. So, property owners, exploration companies, and the State of Louisiana, do not ask for whom the well tolls. It tolls for all of us. (For details email: fairdrilling@aol.com)
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Replies to This Discussion
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Permalink Reply by Andrew Walker on
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Thanks, KB...for agreeing with my proposed 11 changes. If you have time write Governor Jindal and tell him you agreee...as he is apparently studying them himself...
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Permalink Reply by Andrew Walker on
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I do not believe it proper to force a drill site on every tract whether leased or not...but I do believe the operator should be able to extract the gas under the force-pooled, unleased tract with directional or horizontal wells from another surface location. (and I am not angry with the UMI, by the way)
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Permalink Reply by Grillin' - MmmMmm on
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To interject a bit of technical discussion, your idea of drilling the wells in a wheel like fashion isn't a good idea. Shale wells, to be most effective, need to be drilled in directions associated with stress patterns. These patterns run in one direction, thus the horizontal wells need to be parallel to each other, all running in the same orientation. Years of experience in the Barnett have shown that wells that don't follow this orientation are usually not very productive. If you look at the well plots, you'll see all (or most) of the wells are all lined up. When drilled from a "super pad", the wells start at the same surface location, go out a ways and then are turned to line up with the orientation required.
So, wheel-like drilling patterns will yield very poor wells in the majority of cases. Unless I misunderstood your reference to wheel and diagonally. If that's the case, which is could easily be, then the above might not apply.
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Permalink Reply by Andrew Walker on
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Mmarkkkk: are you sure the stress patterns on the Haynesville run in one direction? I've seen 3D on other formations that display a mixed bag of fracture patterns...
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Permalink Reply by Grillin' - MmmMmm on
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I was basing my comments on the Barnett. We drill all of the wells in the Barnett in one direction, with all of them parallel to each other and parallel to the minimum stress direction. The quote below highlights that:
“This has helped people better understand the stress directions in the Barnett,” said Valerie Jochen, Unconventional Gas Technical Director for Schlumberger, which provides stress measurements and overall fracturing services to companies drilling the Barnett. “They want to drill their horizontal wells in the direction of minimum stress and frac them in the
direction of maximum stress, transverse to the wellbore, which maximizes the rock surface area accessed by the treatment.”
Now there are times when you can't get all the wells exactly on that track but generally that's the plan. In many cases, the wells come off of the single pad and go out in varied directions but are then turned to where the section encountering reservoir is run parallel to the others.
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