Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on January 25, 2010 at 11:28

Dixie. I misspoke. I've been looking at too many alternate unit well applications lately. A unit application does not show a well location except in the case where a non-unitized well was drilled before the unit application and then utilized in the application as the Unit Well. Early on there were quite a few non-unitized Haynesville wells. Although I still run across one occasionally, it's not the norm.

Permalink Reply by Cara Leggett on January 25, 2010 at 15:16

Thank you, I am getting a more concise idea about the difference between a well and a unit. I did post a copy of the map. Who can expect to be approached about mineral rights? Is it only those inside of the proposed unit boundary or are those within the adoped unit boundary included?

Permalink Reply by Skip Peel - Mineral Consultant on January 25, 2010 at 15:30

It is a common concern of mineral owners that they may be "left out" if they have not received a lease offer. And sometimes the landmen tasked with leasing the minerals in a unit take advantage of that misconception. The fact is that unit operators want every last inch they can get under lease. They won't jump through hoops or give in to outlandish demands but they will make an attempt to lease every mineral owner in the unit prior to the completion of the first well. If the operator is attempting to form additional units then there will be lease offers made in surrounding sections also. It is the desire of every major operator in this play to have "development blocks". Multiple, contiguous sections in rows, squares, rectangles, whatever. This is one of the big differences in shale gas plays. There is small risk of a dry hole. And the more wells that can be drilled from the same surface locations, accessed by the same roads and served by the same gathering systems and treatment facilities, the more profitable it is for the E&P companies. The analogy is often made that producing shale gas is more akin to manufacturing than it is to traditional exploration and production. Louisiana mineral law affords certain protections to mineral owners. They will not be left out of the royalties generated in a compulsory drilling and production unit. And an unleased mineral owner can lease at any time they wish. Even after the first well is drilled. Or the second or third for that matter.

Permalink Reply by Cara Leggett on January 26, 2010 at 9:13

That was a great communication, Skip. I understood every concept presented. Your message design was logical and had 'flow'. Thank you very much!

Permalink Reply by James McConathy on January 27, 2010 at 10:02

Skip, I own 40 acres in Sabine Parish at Florien. Do you think the leasing will ever get that far South?

Permalink Reply by Skip Peel - Mineral Consultant on January 27, 2010 at 10:11

James, I'd like it think so as I have family who live at Pirate's Cove. Realistically, I do not believe that any one, or company, knows just where the productive HS stops. It can not go on forever. All I can say is follow the furtherest south wells in the Play and see how they come in. Drilling Units have moved south to the 8N -14-10W Ranges but the most southery wells are in the 10N townships 25 to 30 miles north of you. It may be another year or two before the southern limit is discovered. There remains a large number of undrilled acres that are definitely in the Play. Best of Luck.

Permalink Reply by Les Bamburg on January 27, 2010 at 17:05

Cara, formation of a unit is no indication of the timing for actually drilling a well. Many units that were formed in 2008 & early 2009 still do not have any permitted wells. The expiration date of leases within the unit will be one of the primary factors for the timing of drilling a well in the unit.

All mineral owners within the unit boundary participate in the well so you would likely be approached closer to when the drilling of a new well is more imminent.

Permalink Reply by Les Bamburg on January 27, 2010 at 16:58

Cara, you must have acreage in Section 20 or one of the adjacent sections. That is the reason you received a copy of the unit application. You do not receive any notice regarding well permits within the unit.

Permalink Reply by Cara Leggett on January 28, 2010 at 14:04

Thanks for both posts, Les B. I am learning important information at this website. ;) If I won't get any notices, is there any way I can track what is happening?

Permalink Reply by Skip Peel - Mineral Consultant on January 28, 2010 at 14:18

http://www.gohaynesvilleshale.com/group/sonris_help_center

Permalink Reply by Les Bamburg on January 28, 2010 at 19:48

Cara, you can also check the Drilling Rig Locations Group for drilling in your area.

Permalink Reply by Cara Leggett on February 13, 2010 at 3:35

We have been contacted by Scott Fishback of Petro Hawk to set an appointment to discuss a mineral lease for our acreage. The weather got bad and he called back to say he would try to see us next week. He mentioned $6,000 per acre and a 25% royalty. We have been researching which items should be added to the lease to protect us and we know that a 25% royality is a fair offer, but we have no idea about lease amount per acre. Recently, folks around here were offered $5,000 per acre. Now, we are hearing $6,000 to $6,200 is being offered. We are not greedy, but we only have 5 acres and our 401K is still in bad shape as we near retirement. We can afford to wait, if that will bring more money. We want what is fair without causing problems for our neighbors. Is there any advice out there?

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