Replies to This Discussion

Permalink Reply by DJG on February 17, 2010 at 19:52

Hey Herman,

Your profile says you are following that Burke-Hughes #1 well. Is that the unit that you are part of?

If so, there is likely some good news coming as Burke recently resolved their sale/partnership with Chesapeake and it looks like Chesapeake with be coming in and drilling proper horizontal wells on much of the properties held by Burkes vertical wells.

CHK just permitted their Smith 1-H well not to far from you over in the Benjamin White survey and that was also a unit that had been held by Burkes vertical Smith well.

Burke has quite a large amount of acreage held up with their vertical wells, but they did not have the proper capabilities or science in order to do proper horizontal well in their own right.

I have seen a lot of activity from Chesapeake on leases in the S. Strickland survery over the past few weeks, so I imagine that they are cleaning up some missing pieces in their landhold in order to piece those together with their properties aquired in the Burke settlement.

That said, I would image that CHK would be looking to get drilling in your survey in the not too distant future so hopfully that would include your land/minerals as well.

The other good news is that area of Shelby County does look to be a pretty nice spot to be in. Appear likely to have both Haynesville and Bossier and possibly other possibilities as well in (James Lime, Cotton Valley, etc).

Devon's CEO was touting in their year end report just today that they are expecting really good wells (upwards of 6 BCF EURs per well) from their Bossier wells that they are drilling very near to you in this same area.

Permalink Reply by H1 on February 18, 2010 at 15:22

Yes, that is the well I am watching. Thanks for the info. Hope you are right. I would appreciate any info you come across in this area. I come here daily to see if I can get any info.

Permalink Reply by H1 on February 27, 2010 at 5:22

Can anyone tell me what gas price is used when calculating royalties? I have see "gas well head price" and "market price". When the "head price" was about $3.65 the "market" price was about $5.10.

Permalink Reply by adubu on February 27, 2010 at 5:39

it all depends on what broker they sign a contract to sell their gas to and location of well. Contract prices can be variable in the same field with different brokers.

Permalink Reply by H1 on March 7, 2010 at 14:31

Someone consider this scenario and question.
One company sets a 620 acre unit (an odd shaped unit). Then they drill a vertical well in the unit to hold the lease. Later they sell the unit lease to another company that has acreage beside this unit.
Question: Can the buying company come in and re-shuffle the acreage in the units to realign the boundaries in the unit? (possible removing some people's acreage from the producing unit and putting others into it).
An odd shaped unit is not conducive to drilling horizontal wells, so what does a company do when they run into this scenario?
Also, what would be a typical length of a leg on a horizontal well?