The well I ask about in a previous lease pool section where they said they could write in a clause so I could keep my Haynesville Shale rights while they drill for Cotton Valley Sand, but they also are saying that they will be drilling another well or possibly this one for Gray Sand. The Gray Sand depth is about the same as the Haynesville Shale depth, so how can they say I retain my Haynesville Shale rights? It seems they could call them the same and should possibly need to pay Haynesville Shale leasing rates when going for the Gray Sand. Gray Sand depths for this well came from the Office of Conservation Order #10-EE 4.
Any thoughts on this?
Since the Gray Sand underlies the Haynesville shale they will have to drill through the shale to get to the Gray Sand and just drilling through the shale will give them a better evaluation of the shale but they could not complete a well in it if your lease is restricted to Gray Sand. Since the Dept. of conservation will define the limits of what is called the Gray Sand I can see no reason for concern. I am aware of some people, especially in south Arkansas who have held out for shale priced leases where smaller companies with no interest in shale development. In my opinion these people shot themselves in the foot.
My opinions expressed here are mine alone and are not to be construed as advice to anyone as to what they should do with their properties. You alone must be responsible for your decisions. Certainly with good advice from a comptent oil and gas attorney you can have him prepare a lease to achive your goals. Certainly the shale is present in your area.
IT. Can't help with the boundaries of the Gray Sand but there are a number of these wells in the northern portion of Webster Parish. I have done research for clients in the Cotton Valley Field and XTO has a number of GS wells there.
Baron. I agree. And Jay's opinion would certainly be of interest. However, I would point out that there are HA drilling units in 23N-6W (Petro-Chem), 23N-7W (Live Oak) and 23N-9W (Nadel and Gussman). I will go back and review them to see if there is any specific mention of sand. There are numerous older, and productive, Haynesville Sand wells in the Plain Dealing and Springhill areas. These are vertical wells. If there are any horizontals in these new drilling units, it might bear closer inspection.
Just because there are HA units dosn't mean its still shale up there, it will still be part of the same HA formation. As you move north you get towards the ancient coastline, hence the sand. I have also heard from sources in CHK and HK that this water was too shallow for the right conditions to exist that created the highly productive areas further south. But we will see......
Follow up. All recent wells in the above mentioned drilling units are verticals. Some also producing from the Smackover. A few of the applications specifically mention the HA reservoirs targeted as sand. More do not. The wells drilled recently are pretty good producers but nothing like HA Shale. Then again they were much cheaper to drill and in areas with much historic well data. Until I am corrected, I will be classifying these drilling units as HA Sand. If Jay comes into the thread, I would wish to know if the DNR/OOC has a policy of classification or reservoir terms that make the distinction between the two.
Baron. I think this is a good time to remind the members that every well they see being drilled is not a Haynesville well. And some that are Haynesville wells are not the shale. As energy prices increase in the future, every formation (gas or oil) considered of potential value will be explored and quite possibly produced. The HA Shale ain't the only game out there. And it is helpful when negotiating with an operator to know the difference. Many operators have been negatively impacted by the Shale Frenzy. Those that target formations other than the shale can not pay comparable prices.
I tried Dion, we were only interesed in one formation in the CV and would have excluded everything but this formation, but the area was being bid on at the same time by a few of the big boys. They wanted all of the rights in the CV. When I raised my offer they would increase theirs and eclipse mine. Just couldn't compete with a bottomless wallet.
Too bad for the l/o. We would have already drilled the prospect, they could be getting royalties already. We still control half the unit, it could be years before a HA well is drilled there (or never, this is kinda on the fringe).
I agree, that isn't "cool" at all. I am sure some language can be agreed upon to prevent a well from being shut-in for that length of time, especially if the operator is serious about developing the minerals now. Maybe a well written shut-in provision or something similar? I know you are not the only one with that concern. Oil & Gas attorneys (not attorney who claims to know the industry) are pretty savvy when it comes to protecting mineral owner's interest in this capacity.
As exciting as this is, we know that we have a responsibility to do this thing correctly. After all, we want the farm to remain a place where the family can gather for another 80 years and beyond. This site was born out of these desires. Before we started this site, googling "shale' brought up little information. Certainly nothing that was useful as we negotiated a lease. Read More