Replies to This Discussion

Permalink Reply by Robert Duke on February 19, 2011 at 14:05

Yes, I would be surprised by any alternate wells in this area any time soon, unless they wanted to firm up their numbers for the potential of the Bossier Shale, or worked out some fantastic improvements in tech for the HS.  I did look for temps in classic sonris on my well (240843) and did not see anything in completion reports (also just plowed through a bit of permitting).  Are temperatures rarely taken, or did I need to be looking elsewhere?  Thanks Skip, for all your assistance (and I trust we are not screwing up the fishing...).

Permalink Reply by The Shadow on February 18, 2011 at 15:11

There has been very little activity in 11N9W.  However CGG Veritas started 3D Seisemic

from North of Coushatta down Red River to North part of Natchitoches Parish.  The 

Townships and Ranges mentioned above as well as this one will be completed by Veritas

by April 2011 if not before.  Hope this will help generate some leasing and drilling.

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Permalink Reply by Robert Duke on February 18, 2011 at 15:31

Thanks Shadow (is that like "The Shadow Knows!"? ;-)

I would think that if they are doing more detailed seismic, it can only help.  I do wonder what their lease schedules look like throughout this area.  I am HBP over in 12-8, and I am thinking they would still have another year they could have extended me without drilling (under pretty favorable terms for the operator - Encana got in there before everybody knew what a big deal this could be).  If that is typical, they have time to work on the area, but may have to pony up a bit more cash, but not much, for 5th year extensions.

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Permalink Reply by Skip Peel - Mineral Consultant on February 17, 2011 at 11:47

Robert, I don't know that there is a typical percentage of acres leased in a unit.  I too was surprised.  So much so that after some research of the codes, I called the attorney for the Office of Conservation and asked him.  The department relies on business principles that make sense.  Even if an operator gets a unit order, they still have to obtain a sufficient number of leased acres to make development dollar out.  They could force pool all the private mineral interests but it wouldn't do them any good to have a high number of acres non-consent.  And where one company applies for unit designation and another company believes it holds more acres in the proposed unit, they show up and contest the application at the hearing.  It is not unusual for the Commissioner to deny an application with significant opposition from one or more other companies especially those that also wish to operate.

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Permalink Reply by TAURUS on February 18, 2011 at 12:11

It would seem that if it were these company's desire to eventually develop their currently leased acreage the only thing worse than having to lease it once it having to lease it twice. In the case of CHK, they commented in their February presentation that their intention was to slim down drilling "except where it was necessary to HBP leasehold". Does that mean "all" their current leasehold? Who knows. I guess time will tell. Does PXP have a 20% interest in all 525,000 acres that CHK currently has leased in the Haynesville? I'd be curious how much of the carries is left over to cover drilling costs. I had read an article discussing CHK's position in the HS where it said that basically PXP is covering the majority of the drilling costs in return for 20% of the revenue and CHK is along for the ride at 80% of the revenue. That's why it makes sense for them to keep drilling in spite of $4.00 NG prices. So I guess my thought is, "if PXP is covering the drilling costs for CHK throughout the play then why on earth would CHK let even halfway decent acreage fall of the books?". The article even made the comment that they have less to lose by drilling it then they do by letting the leases expire undrilled.

 

Thoughts?

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Permalink Reply by Skip Peel - Mineral Consultant on February 19, 2011 at 9:23

Chesapeake has not joined the move to multiple alternate unit wells, yet.  And still continues to drill to HBP.  This is because when others stopped leaseing, CHK did not.  If you check the Sabine Parish Clerk of Court you will find leases still being recorded in the far SW corner of the LA. Play along and near Toledo Bend.  They seem to be slowing but haven't stopped last I looked.  Their ability to continue when others have stopped is quite likely good hedges and their drilling carry from PXP.  And they like the area where they are leasing as opposed to EnCana being influenced by structural challenges in the area where they are allowing leases to expire.

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Permalink Reply by Robert Duke on February 19, 2011 at 11:24

Okay, GoshDarn, I take the bait.  What exactly is a farm-in?

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Permalink Reply by The Shadow on February 19, 2011 at 15:27

Have land in Ashland, and Chesapeake wanted to lease.  Sent Addendums to Agent

representing Chesapeake, and now told that Chesapeake does not want to lease

even the section is next to Section 8 that was drilled first.  Maybe some other

company will be interested in leasing our land.  Have other property not leased

so this will make more cautious of who to deal with.

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Permalink Reply by Phillip Pruitt II on February 18, 2011 at 12:07

What is the difference between an alternative well and a regular well?

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Permalink Reply by Skip Peel - Mineral Consultant on February 19, 2011 at 9:15

The first well drilled in an approved unit is the unit well.  All wells drilled after that in the unit are alternate unit wells.  All the wells will report their production to the state under the same LUW code.

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Permalink Reply by Sal on February 19, 2011 at 5:44

Skip, Would you please give me the name &  location of the 5 permits mentioned above for Chesapeake?  Thank

you.  Shirley Lambert

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Permalink Reply by Skip Peel - Mineral Consultant on February 19, 2011 at 9:16

Shirley, I'm sorry I can't right now as I am out of town.  Remind me later and I'll post them.

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