Replies to This Discussion

Permalink Reply by Jolly Roger on July 11, 2012 at 3:20

Yes. Did the map open for you? I included a link there, that show everything current.

Permalink Reply by mark edward marchiafava on July 11, 2012 at 3:22

I found it, it's not too far from Vines Restaurant/convenience store where we stop to eat when motorcycling up that way, thanks

Permalink Reply by Bernell McGehee on July 11, 2012 at 3:26

Sorry.  I was responding to Mr. Vine's question.  He obviously already knew about the Ash site and where it was located.  I will attempt to be more descriptive in the future.

Permalink Reply by mark edward marchiafava on July 11, 2012 at 3:30

Our land is appx 8 mles northeast of Gloster, I have yet to talk to anyone up there who's leased to anyone, most haven't even been approached.  If so many tens of thousands of acres are under lease, why not there?  Not being versed in oilfield expertise, a lot of this just doesn't add up to me.  If there's so much potential, you'd think other names would be leasing up everything out there.

Permalink Reply by Steve on July 11, 2012 at 3:58

Many possible reasons: Here are a few :

1.) The TMS has not been proven to be profitable quite yet. Things look promising but a lot more wells will need to be completed. They have proven that the oil is there but how much of it can they recover? The production decline rate is still a big if. Will it produce enough over time for them to recoup expenses and make a profit.

2.) The O&G companies that were willing to try are limited to Encana , Devon and now Goodrich. These allocated a certain amount of money to be spent leasing and they all reached their budgeted limit before they got to your place. Remember that each of the players has several other plays they are pumping money into around the country besides the TMS.

3.) The current players have enough land already leased to keep them busy for quite a while. They do not like to get ahead of themselves - a lesson learned in the Haynesville shale where they paid top dollar in a leasing frenzy only to find out that they didn't have enough time to drill all the leased blocks before their initial lease periods ran out - also the price of gas dropped dramatically ruining the economics - leases were left to expire without drilling and they lost all their bonus payment money.

4.) Your property is a little north of where their geologists wanted to drill right now.

If the decline rate on the already drilled wells is not to steep and if they do not run in to any major obstacles with the formation - too much clay for example - and if they determine that they can make money - you may get leased, but only if they think they can get to your property to drill before the lease term runs out. Right now it appears that they are still taking it slow - drilling where they are having some success and where their leases are closer to expiring. Until they are convinced that the play can be profitable you will not see a lot more land leased. The larger O&G companies like big blocks - those are already leased where they initially believe the prospects for good wells are best - that could change as they learn more. It could bust wide open or it could fizzle.

Unfortunately all we can do is wait , watch and pray.

Permalink Reply by Bernell McGehee on July 11, 2012 at 4:02

The oil  leasing companies have lease target areas based on geology and lease positions established.  Encana is focused on the southern portion of Amite County, but seem to have followed the geology and have gone a bit further north in Wilkinson County.  An Encana rep told me they were trying to centralize their operations was why they were limiting the areas they were leasing.

Goodrich has overlapped Encana somewhat, but they seem to be working together and haven't competed much on leases.

A smaller leasing company, KEW, has focused just north of Liberty, though they haven't leased immediately north of Liberty.

 

I know some other leasing has been going on, but I'm not sure of their areas.

 

It has been interesting to observe the leasing play.  The companies seem to be avoiding each other so as not to have any competitive bidding on leases.  And, I've seen them lease right up to a section line, turn down a lease adjacent, then come back a month later and pay more for that offered adjacent property.  Wild. 

 

I've been told they were leasing one day, just to be told (by the same folks) they have quit leasing the next, then to see them crank it up again the next week.

 

I don't think these guys are lying.  I just don't think know what/where they are going to lease from one day to the next.

So, the who, what, when, where, can be easily replaced by "Who the heck knows?" in this case.

Permalink Reply by Steve on July 11, 2012 at 6:17

I wouldn't eliminate leasing agents and operators lying as a possibility and would elevate it to a probability. But, I do agree with Bernell that in many cases the "front men" for the operators are kept as much in the dark as anyone. I know of pad sites in the TMS that have been built for 6 months that permits have not even been applied for yet and some site permits already issued that haven' had a tree removed yet.

All this just says, to me at least, that there is no discernable plan or at least their plans are "evolving"- to be polite.

Permalink Reply by Joey Humphreys on July 11, 2012 at 7:04

Kinda like Gambling huh

Permalink Reply by Steve on July 11, 2012 at 8:03

 You are correct - drilling for oil is high stakes gambling.

Permalink Reply by Dash Riprock lll on July 11, 2012 at 9:34

The varibles in the gambling equation have changed though, haven't they. In the old days, 1-2 producers out of 10 "wildcats" was sort of par for the course. Nowdays, in conventional plays 3D seismic has improved those odds greatly. In "unconventional" plays like TMS, the oil is all over a huge area but it is the use of just the right drilling/completion/production techniques for a particular situation that seems to be the huge variable.

Permalink Reply by mark edward marchiafava on July 18, 2012 at 2:10

Over on that totally confusing site www.tuscaloosatrend.blogspot.com, there's another totally confusing "map" slathered in blue, overrun with red circles.  Has anyone figured out a way to decipher it?  When the legend notes red circles are "future locations," are those drilling sites?  How does anyone figure out just WHERE in MS this is?

Permalink Reply by Steve on July 18, 2012 at 3:06

The map gives very general locations where Encana has blocks of land leased in Ms. and La - these are mostly in Ms.- Amite and Wilkinson counties which are just across the Ms./La lines north of Clinton and St. Francisville  and in La. - St. Helena, W. Feliciana and E. Fel. parishes. Encana has requested permits from the states for wells in just a few locations so far - those are the rectangular boxes that comprise around 1000 acres each. The red dots are the rumored general locations of Encana's planned wells. If you are trying to ascertain the actual physical locations of the already permitted sights you have to look for those location coordinates in the public data bases, like Sonris in La., or, a shortcut would be the blog you cited above - click on the latest month in the list of months at the lower right side of the page to find Scout Reports. The monthly Scout Reports give you more details, including the coordinates of the location of each permitted well. With those coordinates you can get a specific location, but, it still takes some work to get a physical address. Some of the older posts on this forum will tell you the road names of a few of those well sites. If you want to drive by and look at a site it ain't very easy without the help of locals - many of the sites are not visible from a public road but some are. If you have a specific well site in mind, I would just ask for the physical location on this forum.

The value of Kirk Barrel's map in my opinion is that it simply demonstrates that Encana has a lot of well sites in mind across the play - the red dots. Trying to specifically determine the coordinates of a red dot is impossible. For example, there is a un-permitted Encana well pad already built about 2000 ft. from my property line and I couldn't tell you if there is a red spot on this map for it. Many of the white areas on the map are already leased by other companies, like Devon, Goodrich or Trinity, or, the area is not leased at this point, but, that doesn't mean they are not interested in these areas - Encana has leased the blue shaded areas, comprising a few hundred thousand acres. I would not try to read too much into the red dots at this point. The focus on the selection of spots to drill has more to do with expiring leases than anything else. The oil is probably everywhere - there should be no dry holes - this means, if the economics are proven with continuing good results - meaning decent IP's and decline rates that are as good or better than the Eagle Ford Shale, then everyone will eventually - may take 10 years- be in a producing well unit. IMO. You might want to Google the Eagle Ford Shale in Texas for an idea of what could an probably will happen in our area. Their boom started in 2008 - we are just gaining some momentum in the TMS. Decline rates on newly producing wells and the ability to reduce costs of a well are what we should be concerned with at this point. I believe we are now over the 1st big worry, which was successful frackability of the shale due to its high clay content. IMO

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