Replies to This Discussion

Permalink Reply by Chad Ellis on March 4, 2021 at 4:03

Attached is a snap shot of the field rules.  Basically, the are no restrictions on wellbore spacing within unit.  However, operators have there own spacing based on the geology of the area and their stimulation procedures.  As far as unit spacing, the wellbore must be 330’ from the perpendicular lease lines and the first and last take points can be no closer than 200’ from nearest lease line.

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on March 5, 2021 at 4:15

Chad, what are the regs regarding "amending" unit size? Also, can you explain how unleased tracts within a unit are treated as to lateral perfs?

• ▶ Reply

Permalink Reply by Chad Ellis on March 5, 2021 at 16:50

To amend a unit, the operator will have to file a new unit designation with the RRC and the county(s).  The new unit must comply with any applicable field and spacing rules for any existing wells, as well as any proposed wells within the strata for the unit.  Since we are not on the RTS system, this can result in some unusually shaped units.  As for unleased tracts, this can get complicated.  Tracts with clear mineral title that will not, or cannot lease are treated as off unit.  As such, the perforations of the wellbore must exclude this area plus any required setbacks.  Tracks with undivided interest where a portion of the mineral owners have a lease are developed.  Those owners that prove up their possession receive their appropriate royalty payments.  The remainder go into escrow held by the state.  Texas law promotes the development of the oil and gas resources while allowing the settlement of disputed claims to be litigated later without excessive loss of principle. 

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on March 10, 2021 at 9:27

Thanks.

• ▶ Reply