What happens when bottom hole location is in different section than surface hole?
I just saw that another well has been permitted in our section but it shows the bottom hole will be in another section. Do we get the royalties, split the royalties, or do the bottom hole owners only get the royalty?
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Permalink Reply by DJG on
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Keep in mind that the perferations in the lateral will only be present in the section/unit where the bottom hole is located. That said, there will be for all pratical purposes no drainage of the reserves from the surface location is in this type of situation.
Only party that would receive any compensation from the non-producing section would be the surface owner who granted surface rights for the pad location.
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