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Permalink Reply by Skip Peel - Mineral Consultant on September 16, 2010 at 10:20

Dang, out bullet pointed again. Drat! LOL!

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Permalink Reply by Skip Peel - Mineral Consultant on September 13, 2010 at 5:26

LWC, without specifics, I would presume that you are referring to a "Pre-conference" notice letter for a local (District 6 - Shreveport) meeting. Whether it was held or not in August, the public hearing date should appear on the Commissioner's public hearing schedule this week or next. I'll try to post it here if it does in fact make the schedule. I agree with your definition of a decent lease up to a point. In general the value of larger tracts is greater than smaller tracts and tracts situated as to be good pad sites have additional substantial value. If those mineral owners who were in a position to receive a better offer because of those specifics would choose to forgo the improved terms and accept what the other mineral owners are offered, that would certainly be their prerogative. However those other mineral owners might feel unfairly treated by them for taking a better offer and the lessee for making them a better offer. This is business and trying to determine "fair" and use it as a basis for negotiating is an extraordinarily short sighted business strategy excepting the case where every mineral owner has the same size tract and the same surface conditions such as a residential subdivision.

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Permalink Reply by LWC on September 13, 2010 at 5:42

The pre conference letter was followed by an application letter and supposedly the public hearing occurred the end of August in Baton Rouge. This is rural property with the majority of it owned by the Paper company. The other MOs probably allowed pad placement because they have enough acreage. The most likely place for a pad is on the paper company land, largely because it doesn't infringe on any dwelling and it already has graveled road access into the land. The other MO's leases had all the usual protections except limited surface activity.

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Permalink Reply by Skip Peel - Mineral Consultant on September 13, 2010 at 6:03

What s-t-r and or field are you referring to, LWC? Locating a pad is quite specific as to the orientation and length of the lateral. Other than the minimum set backs required by the state from structures and unit boundaries, no other surface details are important. Pads don't get located based on existing roads for example. An operator may use an existing road for access off of a parish road but they will then make an extension to wherever the pad will be located. They will not just place a pad adjacent to an existing road unless, by happenstance, that road already leads to the planned pad site.

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Permalink Reply by LWC on September 13, 2010 at 6:58

Section 29, T18N, R10W sligo field. Please explain 'orientation and length of the lateral'?

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Permalink Reply by Skip Peel - Mineral Consultant on September 13, 2010 at 7:30

BEUSA unitized Section 29 on July 27. My pardon, I thought we were discussing the Haughton area. Section 29 is Doyline. Haynesville Shale horizontals have the lateral portion of the well bore drilled in a north-south orientation as that is the axis that intercepts the maximum number of naturally occurring formation fractures. As most Haynesville Drilling Units are a mile square governmental sections (~640 acres) and the state requires that perforations in the lateral well bore not occur within 330' of a unit boundary, the longest lateral allowed is ~ 4620' ( one mile = 5,280' less the 660' prohibited set back at both ends of the lateral). Since a vertical well bore can not make a 90 degree turn, a radius is required to transition from vertical to horizontal. To get the longest allowable lateral, this radius must be considered. A well pad location within the section to be drilled makes it hard to get that longest allowable lateral. It is easier to drill from an adjoining section so that the well bore has reached its horizontal orientation within that first 330' of the section to be produced. The gas factory concept employed by the major shale players has pads on either side of a shared section line accessed by a single road and pipeline right-of-way with wells drilling north-south from the adjoining sections. I hope that my very condensed explanation helps you to understand how the location of well pads is critical to the best practices for drilling horizontal HS wells.

Perhaps this video will help you to understand the process:

http://www.oerb.com/Default.aspx?tabid=242

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Permalink Reply by LWC on September 13, 2010 at 8:31

WOW!! Between your description and the website videos the dimmer switch in my brain just opened to full current! What a wealth of information you are for those of us trying to understand this industry. Thank you. So if I understand this properly, BEUSA unitized another section bordering Sect 29(seen on the application letter) and to facilitate the access within the boundaries will vertical drill in say Sect 28 with the horizontal (lateral) drilled into Sect 29? The reason being that the curvature of the well bore to drill the lateral leg must be calculated into the distance? Do I have it right?

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Permalink Reply by Skip Peel - Mineral Consultant on September 13, 2010 at 8:44

Yes, you have the concept right however I haven't looked at the specifics of the well pad location or the development designs of BEUSA. Bridas Energy - USA is a very small operator with limited horizontal experience. My description of how an operator prefers to set up it's development design for HS horizontals pertains more so to Chesapeake, Encana/SWEPI, Petrohawk and other major players. You can look at the location for a well pad within a section on the first line of the Scout Info in a SONRIS Well File. It will look something like this, 380' FWL and 435' FSL in Section X. FWL - From the West Line, FSL - From the South Line. This would place the pad in the extreme southwest corner of the section. If the well location is in one section but the lateral is being drilled into the adjoining section, the surface location will look similar but be followed by PBHL (Planned Bottom Hole Location) 330' FSL and 410' FWL in the section immediate south of X. The perforations in the lateral would all be in the section south of X and those mineral owners would receive the royalties.

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Permalink Reply by The_Baron on September 13, 2010 at 9:12

We are getting a litle off topic.....

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Permalink Reply by Skip Peel - Mineral Consultant on September 13, 2010 at 9:24

Guilty, you honor. LOL!

Permalink Reply by Eric S. Clarke on September 19, 2010 at 12:35

OK back to the discussion topic at hand. Yes, our site was hijacked and required us to obtain a new domain name with only a slight deviation from the original website. new site address is

east80oilandgas.org

we are still having a few technical difficulties with it but should have them fixed momentarily.

The hijacked domain name and site was east80oilandgas.com (WE NO LONGER HAVE)

Thank You and tell everyone you can about the new change.

Eric S. Clarke
East 80 Oil and Gas Coalition, President

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Permalink Reply by Jack Jordan on September 19, 2010 at 16:55

I just tried and it worked...good job and thanks for starting the discussion...it has been interesting in more ways than one... :)

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