Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on November 1, 2023 at 14:27

Cortez, the Smackover Formation, like many producing Gulf Coast formations, follows the outline of the prehistoric Gulf of Mexicon.  So it is an arc from central Texas NE to the border between Arkansas and Louisiana east, then down SE through Mississippi and Alabama ending in the Florida panhandle.  The Smackover has been explored across that entire arc and as with all conventional reservoirs has been productive in limited area scattered across that arc. There are producing Smackover wells in your township, sections 17 & 18, and a plugged and abandoned Smackover well in Section 19 which is a mile further south.  There are no historic Smackover wells south of there.  Please realize that the Smackover will have areas where the lithium concentrations are economic and there is a sufficient volume of brine and areas that do not.  We haven't heard of any interest in Louisiana and you may be too far south.  It will take years to find the economic areas and processing of lithium from brine will not get underway until 2026 at the earliest.  It is too early to get excited.  You, like many of us, will have to be patient and see if our areas draw leasing interest in the future.

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Permalink Reply by Cortez Fields on November 2, 2023 at 4:13

Thanks for the reply. You stated my basic thoughts on the matter. However it turns out it’s a good thing for this part of the country with hopefully a positive impact on all. Thanks again for all that you do. 

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Permalink Reply by Bradley McWilliams on November 5, 2023 at 13:50

Good evening Mr. Peel.  Been quite a while since I've been on here, glad to see y'all are still high steppen'!  

Do you have a thought on how much activity would come from the lithium potential?  Myself, I just don't see it being a large scale drilling everywhere type operation, but instead I think it would compare to the bromine production in south AR now in place.  Basically a relatively few wells supplying a very large industrial facility to extract the lithium.  I just don't think it will compare to a shale, or even conventional O&G play with dozens of rigs drilling hundreds of wells.  Any thoughts?

Thanks.

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Permalink Reply by Skip Peel - Mineral Consultant on November 5, 2023 at 14:03

Welcome back, Bradley,  you've got the right take.  This certainly isn't a play like the Haynesville Shale.  And it is even more unpredictable than conventional O&G plays of the past.  I think the best comparison may be the Cotton Valley trend.  It occupies a similar disposition across E TX, N LA and S AR but is only economic in a scattered number of very limited areas.  The Smackover brine will be hit and miss and those that end up in an economic island will be lucky.  Where those areas exist will take some years to fully identify.

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Permalink Reply by Bradley McWilliams on November 5, 2023 at 14:12

That's what I was guessing.  No experience to go by, other than seeing the bromine operations down there now.  They do drill a few wells now and again, but nothing to get excited about from the viewpoint of either a service business or nearby land owner.  I do think overall it will be great from the standpoint of a few large plants being built and good jobs being available for local folks, but I don't foresee it being another case of "shaleionares".  

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Permalink Reply by Skip Peel - Mineral Consultant on November 5, 2023 at 14:44

Arkansas has regulations in place that limit the mineral rights owner's ability to negotiate and benefit from brine.  Unfortunately those regulations were established long before the value of lithium was realized.  The jury is still out on E TX mineral owners but the Smackover appears to be equal if not more economic there.  Still the Texas Railroad Commission is known for being "industry friendly" and will likely limit the ability of mineral owners to benefit from brine in favor of the industry.  Land owners are traditionally uninformed and not aggressive in pursuing their best interests.  They will end up with whatever the Commission deems their fair share.  Some will take the modest benefit and be happy and some will complain loudly after the fact to little avail.

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Permalink Reply by Rock Man on November 6, 2023 at 12:06

A point to keep in mind with this lithium effort in the Smackover (or any other formation) is that not all Smackover waters are the same. They will vary drastically from area to area - which impacts the viability of any lithium play.

This is the same as for bromide extraction from Smackover water - not all areas are viable due to variable chemistry compositions of the water in the reservoir.

A prime example is one I posted on another thread concerning Smackover water lithium content in NW Cass County based on published USGS data. Lithium ranged from very good (over 600 mg/liter) to less significant (around 200 mg/liter) to under 100 mg/liter concentrations - all over a less than 10 miles distance.

There is no way to evaluate lithium or any other mineral content in formation water from open hole logs - once needs to actually produce water from any wellbore, capture a good water sample and have a legitimate lab analyze that water for mineral concentrations.

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Permalink Reply by Bradley McWilliams on November 6, 2023 at 12:13

Thanks for the info.  Would make an expensive answer to the obvious question...

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