Replies to This Discussion

Permalink Reply by Jack Blake on September 30, 2008 at 15:47

I'm in one of these sections(21 T10N R11W). I leased to CHK.
Does this mean SWEPI has aquired my lease?
What are the chances now of getting a well drilled in my section?
Do they have to file another application when they actually plan to drill? a permit to drill or something?
Please answer any or all questions?
Have not been to SONRIS today. I'll go there now.
thanks

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Permalink Reply by Skip Peel - Mineral Consultant on September 30, 2008 at 15:55

Jack Blake. I just came across the information and I'm still processing it. Get back to me after you have reviewed the unit application on SonRis. Skip

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Permalink Reply by Jack Blake on September 30, 2008 at 15:55

I've been to SONRIS and looked around SONRIS lite. Can you tell me the path to get to where you got this info.?
thanks

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Permalink Reply by Skip Peel - Mineral Consultant on September 30, 2008 at 16:16

Jack, try this link and look under the Oct. 28 schedule of hearings.

http://dnr.louisiana.gov/CONS/CONSEREN/hearings/pubhearings2008.htm

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Permalink Reply by Jack Blake on September 30, 2008 at 16:37

I found it thanks. I looked at it. I did recieve that in the mail. I still have my questions.
I have another good question that may mean more $ for us.
A friend of mine who in a Landman wrote my addendum page.
He put in my addendum "This lease shall not be deemed to cover and does not grant Leassee the authority to produce hydrocarbons between the depths of the surface of the earth and the stratographic equilavent of the base of the Cotton Valley formation.
The application was for the Cotton Valley and HS. It even defined the Cotton Valley as 9870'-11135' and the HS as 11135'-13140' based on an eline log.
I think I am unleased for the Cotton Valley and can get more bonus. If they filed application for the CV, then they must think we have CV gas also.

How do I find out if Chesapeake still has my lease or if they sold it to Shell?

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Permalink Reply by Skip Peel - Mineral Consultant on September 30, 2008 at 16:51

Jack. Check with your parish clerk of court. If Chesapeake has assigned the lease to SWEPI, it will be recorded. Sooner or later. I would also suggest that you speak with an experienced Oil & Gas attorney concerning the lease clause that you mention. I would do so before the Oct. 28 hearing if I was in your position. Be proactive and protect your interests. Good Luck. Skip

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Permalink Reply by VSC DeSoto South on September 30, 2008 at 17:14

I guess the wells they have already drille din the area must be worth the new proposed units and continuing to move forward.

My unit was unitized earlier this year, but they have not drilled yet.

I am trying to continue to be patient.

Congrats to you all.

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Permalink Reply by Dick Shuford on October 1, 2008 at 0:01

Before I open my mouth and stick my foot in it, I'd like to state that I am not an authority on geological formations nor production. BUT, it is my opinion that SWEPI is getting as many sections (or as much area) as they can under the (640 acre) ruling. Then they have things locked up for decades. In talking to other people that have degrees in such matters, they are convinced that this is a bad ruling for The Haynesville Formation.

For years The Dept of Conversation has more or less allocated 640 acres for the deeper production. It has been accepted and done for a long time. My problem is that I don't feel that in the tight shale, (this is a new game and unknown from a depletion standpoint) they are producing from the total 640 acres. Swepi's advantage is when they get a 640 acre unit set up, they can control things for the next hundred years. Let's say they drill a well per section. That vertical well will not drain that section in your lifetime. But they now have control of the section and you have to wait until they decide to do more wells. It may be next year but I bet on ten years.

It is my opinion that The Department of Conversation is not and has not done the proper engineering work to be able to allocate 640 acre spacings in this TIGHT formation. Now everyone is looking to see if they have land in a 640 acre unit. Most people think this is good. In my opinion it means you are locked up, but that doesn't mean your are rich. I STRONGLY ADVISE THAT YOU CONTACT THE DEPARTMENT OF CONSERVATION and request that SWEPI only be allocated these sections on the basis of a horizontal wellbore. At least this way you can have some kind of assurance that the section is being produced at some sort of proper and professional manner. DON'T LET SWEPI TIE UP THIS KIND OF AREA WITHOUT SOME KIND OF OBLIGATION TO THE ROYALTY OWNER. I don't believe that the reservoir can be produced by one well.

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Permalink Reply by Grice on October 1, 2008 at 0:44

There are laws which require the operator to work in good faith of the well. Your suggestion of an operator to purposely withhold production rates, as a means to secure the unit for years, would not indicate good faith operations.

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Permalink Reply by Skip Peel - Mineral Consultant on October 1, 2008 at 1:09

Dick, you are right to be concerned. The length of the initial terms and extensions on the leases in these units along with the price of ng and the growth of demand will dictate how SWEPI develops their leasehold. But mineral owners and the STATE have a stake in efficient and timely production. The Department of Conservation holds public meetings to allow for public comment. Regardless of what the DOC has done or not done in the past, mineral owners should take advantage of the opportunity to voice their concerns at these meetings. One of the reasons I posted this as soon as I ran across it was to give as much advance notice as possible to those mineral owners with a stake in these units. Those wishing to be proactive now have the time to consult legal counsel and gather information to support their desires for efficient development of their minerals. I suggest that you organize as many lessors as you can and set the agenda for their input to the DOC. Organize two groups. One which will attend the meeting with support from legal and industry professionals and one which will manage a letter writing campaign for those unable to attend. Every unit application includes an interested party list which gives the name and address of those mineral/surface owners within the unit boundaries and those immediately adjacent. Since you are an "interested party" you have access to that list. If you get started now, I think you may have a fair chance of affecting the outcome of that public hearing. I would like to see an organized, well prepared group try. To you, and to all mineral owners in this Play, I would say that the State of Louisiana has a reason to regulate in such a way as to maximize revenue. A reason shared with mineral owners. If those mineral owners become an organized force, it gives the DOC the opportunity, and political cover, to regulate aggressively. Good Luck. Skip

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Permalink Reply by Skip Peel - Mineral Consultant on October 1, 2008 at 1:37

Thanks, KB. I have been waiting for an opportunity such as this. I would like to see a well organized and prepared group of mineral owners make their case to OOC at a public hearing. Now that many of them are more knowledgeable and linked through this site, I am hoping that they take their advocacy to the next level. I agree with your earlier post that the first thing to ask is,
"the question landowners should ask at each conservation hearing no matter the formation is whether and what shows that the proposed unit and the proposed unit well is sufficient to drain the particular reservoir/formation "efficiently."

You bring up another critical point concerning the "interested party" lists. They should be required to be sent to every individual or business who receive prior notice of the application hearings under OOC regulations. Knowledge is power. Now I hope to see these land/mineral owners take what they have learned on this site, from you and other knowledgeable members, and use that power to participate in the efficient management of their mineral interests.

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Permalink Reply by Skip Peel - Mineral Consultant on October 1, 2008 at 1:58

The link that follows is the SWEPI San Miguel Creek application, Docket # 08-1666 and 08-1667, for the Oct. 28 hearing. The last few paragraphs of page two should be of interest to all the land/mineral owners who are interested in taking an active part in this and all other hearings.

http://dnr.louisiana.gov/CONS/CONSEREN/hearings/2008/10OCT/08-1666&...

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