Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on January 15, 2010 at 14:13

The Ellora well permit for the Whitney (239677) has expired and can not be drilled under this serial number. Take the '"forest of new derricks" comment with a grain of salt. Section 28 is two miles south of the southern most completed HA horizontal wells. It's too early to tell. It is a good turn of events if EOG is interested in this area. They are very qualified as a horizontal driller. Hopefully Ellora will sell out or let EOG operate under a joint venture agreement. Ellora is not a shale player.

After a quick check, EOG does have a well permit for 240466 in Section 28. This well has a surface location in Section 28 but is drilling into, and will pay royalties, in Section 33. This will be an important well for this area of the play. Good Luck.

Permalink Reply by Kurt Grussendorf on January 15, 2010 at 14:27

Skip: Whitney has doubled their offer for water access with a pipeline across my property to be in place for no longer that 2-3 weeks. My friends in Many urge me to accept as it may set the stage for a longer-term relationship with them The tone of their e-mails and recent phone call was--shall I say--a bit more cordial. But as you say: "It is business and not personal." Kurt.

Permalink Reply by Skip Peel - Mineral Consultant on January 15, 2010 at 14:35

Kurt. I think it an opportunity worth exploring. My personal preference would be for a longer term agreement. Remember it's not Whitney, but EOG that will be drilling the wells in your area. For years to come. I'd further suggest that you have an experienced O&G attorney review any agreement. Good Luck.

Permalink Reply by Kurt Grussendorf on January 15, 2010 at 15:10

Skip. The agreement is with EOG and not Whitney. Thank you for pointing that out. I will review the document carefully. But I think I will take the 2-3 weeks and attempt to establish some good will as a person who can be worked with. I also let them know I would be willing to let them use my land for storage or other facilities under separate agreement in future. I even mentioned the artesian well on my property but that would most likely tie into the SRA water table and they might have something to say about drawing water from that for commercial purpose.

I am curious to know what kind of deal they have with SRA and how much they can pump out and at what price. I am assuming a legitimate outfit like EOG has a permit. I think you are correct in saying they will need vast amounts of water once they get underway and start fracing. Not quite sure why they only want 2-3 weeks worth of water unless that is all SRA allows or it is some sort of initial test they are doing on a well. Also not sure which well it is. Thanks again. Kurt.

Permalink Reply by Les Bamburg on January 15, 2010 at 20:18

Kurt, the frac'ing of a well only requires about 1 week so the 2-3 weeks would likely cover some activity before and after the frac'ing operation plus some timing "flex".

Permalink Reply by Kurt Grussendorf on January 16, 2010 at 3:50

Howdy, Les B. I really don't know too much about frac'ing. Is that a one time event or is it an on-going process as they drill or attempt production of gas? And will they need more water over time as they drill or if the well starts producing are there going to be water needs? This would be helpful to know. I just thought the entire process--not just frac'ing--required lots of water over a longer period of time. Appreciate your giving a brief synopsis of potential water needs as you seem to be the expert. Thank you, Kurt.

Permalink Reply by Skip Peel - Mineral Consultant on January 16, 2010 at 3:56

The standard length HA lateral is approximately 4600', has multiple frac stages and requires about 3 million gallons of fresh water. There is some conjecture among knowledgeable industry members that wells may be re-fraced at some time in the future when production declines to a certain level. Whether this occurs or not, there are over 25,000 potential wells in the NW. LA. portion of the HS play based on 80 acre spacing. These wells will take many years to drill.

Permalink Reply by Les Bamburg on January 16, 2010 at 4:55

Skip, refrac of horizontal multi-stage wells is not technically feasible due to the frac orientation to the wellbore. Refrac's were done in the Barnett Shale on some vertical wells.

Permalink Reply by Skip Peel - Mineral Consultant on January 16, 2010 at 4:59

Les. I phrased my response purposely as two of my favorite GHS members whose knowledge I respect have differing opinions. I am aware from past discussions that you consider re-fracing unlikely. Jay (Shalegeo) holds the opposite view. Time will tell. Until then I'll remain on the fence. My point is that the quantity of water needed to frac all the HA wells allowed by spacing in the play is huge regardless if no well is ever refraced.

Permalink Reply by Kurt Grussendorf on January 16, 2010 at 5:06

So, Les B, are you telling me that the water requirements will be minimal and not on-going. I just want to know if they will approach me again in the future. Or is it just a one time deal per wellhead? I rather liked the idea of being a small-time water access baron--you know--a thousand here and a thousand there--peanuts to some but a nice little trickle of cash now and then. Oh, well. I bought the land for the recreational value and did take some timber off of it. My specialty is lakeshore real estate and that is what I got. I do not have the mineral rights :0( But I did get a good price for lots of lakefront.

Permalink Reply by Les Bamburg on January 16, 2010 at 6:04

Kurt, initially it would be one-time but at some later time you could be approached for a longer term access to the lake.

Permalink Reply by Les Bamburg on January 16, 2010 at 5:16

Kurt, the fracturing process is a one-time event for each new well so the water requirement only occurs once for each well. Currently operators are generally drilling only one well per section so it may be some time before additional water is required.

The sequence is drill the vertical and horizontal sections of the well, run production casing, perforate the lateral, fracture stimulate ("frac") the lateral, and flow back gas from the well. During initial flowback, the well will "clean-up" by unloading some of the frac water and some solids. Also, during the initial couple of weeks a 24-hour flow potential test will be conducted and reported to the State.

During the clean-up period, approximately 15-20% of the frac water will flow back from the well and can be recovered. The remainder of the water flows back slowly over the well life. During this period there is no additional water required for the well. Actually, some operators are planning to reuse any recovered frac water in frac'ing other wells to reduce their requirement.

Eventually operators will move into a "pad drilling" mode when they will drill 4 to 8 wells per section. In this mode, the water requirement will become more frequent in that area during the pad drilling period.

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