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Permalink Reply by Skip Peel - Mineral Consultant on December 1, 2009 at 4:38

North LA. Yes, vertical wells are significantly cheaper than horizontal wells. The wells you refer to appear to be Cotton Valley wells. Unlike the Shale, the CV formation is not productive across a large, contiguous aerial extent. It is quite common to drill a good well and then a dry hole at short distance away. An opinion of "common sense" should include the development focus of a company. In the case of Greystone and Weiser-Brown, their focus appears to be Hosston and Cotton Valley exploration and production. Not every company has the option to drill Haynesville wells. A company drills the formations they consider to be prospective on the land to which they hold lease rights. Some of the wells you mention may have tested the Smackover. If so the companies did not consider the formation to be productive as they chose to produce shallower formations. My observations come from a quick review of wells by the companies you mentioned. If you wish a more specific overview I suggest that you perform a SONRIS search of the surrounding township sections for all wells and make note of those producing and those that are not. I suspect that you will find a mix of both and production from several different formations. Those formations will be "conventional" as opposed to "unconventional" reservoirs (The Shale) and therefore will exhibit localized productivity with numerous dry holes interspersed across the areas being developed.

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Permalink Reply by The_Baron on December 1, 2009 at 5:23

I second what Skip says,

We once drilled a Smackover well, it came in big and still produces years later. We moved over a hundred yards or so, drilled another....dry as a bone.

Its called the oil buisness...

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Permalink Reply by North LA on December 2, 2009 at 6:22

Thanks for the explanation.

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Permalink Reply by Randy on December 1, 2009 at 6:46

Let's also consider that they are trying to maintain a lease.

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Permalink Reply by North LA on December 2, 2009 at 6:22

I doubt that. The Monroe gas field has 1,000's of little wells putting out 10mcfd to maintain HBP.

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Permalink Reply by Randy on December 2, 2009 at 7:43

Ahh, I didn't actually look at where they were talking about.

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Permalink Reply by ur dern tootin' on December 1, 2009 at 17:13

Let's think for a moment like a geologist. The Greystone geologist has observed that the Haynesville Shale is the source bed for the Hosston and Cotton Valley formations in northwest Louisiana. That same Greystone geologist thinks that if the Hosston and CV formations have a deeper source bed in northwest louisiana (the Haynesville Shale), then the same shallower formations that currently produce gas in the Monroe Gas Field in northeast Louisiana must overlie a deeper source bed, as well. It is virtually "impossible" to replace the extremely large volumes of natural gas produced from the known reservoirs of the Monroe Gas Field for over a century back into those same known reservoirs. It just won't "fit". This would indicate that natural gas is continuously moving upward from a deeper source bed. This means that the Greystone geologist is looking for the Monroe Gas Field's source bed!

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Permalink Reply by Skip Peel - Mineral Consultant on December 1, 2009 at 17:45

I would think it much more likely that wells in the 12,000' range are testing the Gray Sand interval of the Smackover formation in Union and Ouachita parishes. But then again I am limited to thinking like a landman. LOL!

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Permalink Reply by ur dern tootin' on December 1, 2009 at 18:06

Well SP, all we need now is for a lawyer, a fat banker, and an engineer to chime in with their opinions. We can form a natural gas exploration company and go see for ourselves. :)

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Permalink Reply by North LA on December 2, 2009 at 6:27

I like your explanation :)

Is Greystone a private company? Is it a JV of a larger company like HK, CHK, Devon? I've never heard of them and I can't find where they've ever actually had production on Sonris. Maybe they can fund all these hit a misses with some production off of a Texas field.

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Permalink Reply by Skip Peel - Mineral Consultant on December 2, 2009 at 6:39

Greystone Oil & Gas, LLP is Organization # G179. If the following link is inoperable, go to SONRIS Lite, search by organization name and enter Greystone for a listing of their LA. wells.

http://sonris-www.dnr.state.la.us/www_root/sonris_portal_1.htm

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