Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on October 14, 2019 at 8:52

It's not the size of the section, it's the portion of the lateral lying in each.  What you need are the "perf letters" in order to confirm the percentage of perforated lateral that lies in each section.  It is a common development design to drill ~7500' laterals north and south from one or more surface locations in the middle section of three sections stacked north to south.  Without knowing the specific wells in your example, I can't tell if this is the case but it sounds as if it may be.  This usually results with approximately one third of a CUL producing from one section and two thirds from the other.  This design shows an operators intention to eventually drill the mirror image wells in the opposite direction which makes up for the short term situation of a lateral producing from only one half of a section.

As to your second question, please post the specific wells.

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Permalink Reply by Steve P on October 14, 2019 at 9:06

Comstock is 26-12N-15W, CUL for 35 12 15 and 2 11 15 (McCoy well)  251241

GEP is 2-9N-12W CUL for 35-10-12 and 2-9-12  (Hall well)                    249632

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Permalink Reply by Skip Peel - Mineral Consultant on October 14, 2019 at 9:43

Re: McCoy

08/01/2019	616433			1	0	0	314736	0	0	DE SOTO
07/01/2019	616433			1	0	0	384886	0	0	DE SOTO
06/01/2019	616433			1	0	0	406789	0	0	DE SOTO
05/01/2019	616433			1	0	0	480899	0	0	DE SOTO
04/01/2019	616433			1			290293	0	0	DE SOTO
03/01/2019	616433			1	0	0	320475	0	0	DE SOTO
02/01/2019	616433			1			312641	0	0	DE SOTO
01/01/2019	616433			1			388079	0	0	DE SOTO
12/01/2018	616433			1			122943	0	0	DE SOTO
07/01/2019	618115			2			196099	0	0	DE SOTO
06/01/2019	618115			1	0	0	207259	0	0	DE SOTO
05/01/2019	618115			1			244814	0	0	DE SOTO
04/01/2019	618115			1			301538	0	0	DE SOTO
03/01/2019	618115			1			332888	0	0	DE SOTO
02/01/2019	618115			1			324752	0	0	DE SOTO
01/01/2019	618115			1			403111	0	0	DE SOTO
12/01/2018	618115			1			127705	0	0	DE SOTO

December thru April look as they should across both units.  May is when production totals diverge.  There should be two wells reporting under each LUW code.  It appears to me that production for one of those wells is dropped for May thru July.  Only LUW code 616433 reports August production.

How do those SONRIS production volumes coincide with your royalty statement volumes?  If your statement is accurate for volumes May thru July, then SONRIS may have missed the entry for one well but not the other.  If this is a SONRIS snafu, I think I can get the Production Audit section to correct it.  I'll look at the other two wells a little later.

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Permalink Reply by Steve P on October 14, 2019 at 10:04

on the Comstock well, I'm not yet in royalty payment status.  We are having "discussions" with Comstock over a lease issue.

So, basically, the fact that one section is larger than the other is irrelevant?  It is based on horizontal linear foot of pipe in each section?  For the Comstock well, the drill site is in 26-12N-15W, but with no production in Section 26, but the lateral extends through all of Section 35, but only a portion of Section 2.  So, obviously, Section 35 is getting a much larger share of the production than Section 2.

Thanks - as I typed this to respond to your info, it starts to make sense to me now.  But I still don't understand why the allocation of total production would not have the same % every month, and the reported production for each LUW in the McCoy well is not consistent.

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Permalink Reply by Skip Peel - Mineral Consultant on October 14, 2019 at 11:15

I had to take a break and do something else so I am going by memory but the perf letters for both sets of wells were very close to 50/50.  The McCoy wells monthly reporting irregularities were obvious but before the divergence looked reasonable for the slight variation from a 50/50 split.  I have yet to look at the Hall wells.

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Permalink Reply by Skip Peel - Mineral Consultant on October 14, 2019 at 13:37

Hall wells.  Considering the fact that 47.64% in in SUPP and 52.36% in SUI, these monthly production reports look okay.

LEASE\UNIT\WELL PRODUCTION

RPT DATE	LUW CODE	STORAGE FAC	DOC USE	WELL CNT	OPENING STK	OIL PROD(BBL)	GAS PROD(MCF)	DISPOSITION	CLOSING STK	PARISH
08/01/2019	617915			1	0	0	43229	0	0	SABINE
07/01/2019	617915			1	0	0	44033	0	0	SABINE
06/01/2019	617915			1	0	0	47401	0	0	SABINE
05/01/2019	617915			1	0	0	51782	0	0	SABINE
04/01/2019	617915			1	0	0	53122	0	0	SABINE
03/01/2019	617915			1	0	0	57975	0	0	SABINE
02/01/2019	617915			1	0	0	59609	0	0	SABINE
01/01/2019	617915			1	0	0	67969	0	0	SABINE
12/01/2018	617915			1	0	0	71660	0	0	SABINE
11/01/2018	617915			1	0	0	77936	0	0	SABINE
10/01/2018	617915			1	0	0	91363	0	0	SABINE
09/01/2018	617915			1	0	0	101610	0	0	SABINE
08/01/2018	617915			1	0	0	119132	0	0	SABINE
07/01/2018	617915			1	0	0	143840	0	0	SABINE
06/01/2018	617915			1	0	0	153834	0	0	SABINE
05/01/2018	617915			1	0	0	178932	0	0	SABINE
04/01/2018	617915			1	0	0	186600	0	0	SABINE
03/01/2018	617915			1	0	0	211120	0	0	SABINE
02/01/2018	617915			1	0	0	205449	0	0	SABINE
01/01/2018	617915			1	0	0	232644	0	0	SABINE
12/01/2017	617915			1	0	0	223756	0	0	SABINE
11/01/2017	617915			1	0	0	220657	0	0	SABINE
10/01/2017	617915			1	0	0	227890	0	0	SABINE
09/01/2017	617915			1	0	0	220222	0	0	SABINE
08/01/2017	617915			1	0	0	231237	0	0	SABINE
07/01/2017	617915			1	0	0	230569	0	0	SABINE
06/01/2017	617915			1	0	0	220823	0	0	SABINE
05/01/2017	617915			1	0	0	232077	0	0	SABINE
04/01/2017	617915			1	0	0	222324	0	0	SABINE
03/01/2017	617915			1	0	0	227886	0	0	SABINE
02/01/2017	617915			1	0	0	205013	0	0	SABINE
01/01/2017	617915			1	0	0	228279	0	0	SABINE
12/01/2016	617915			1	0	0	229815	0	0	SABINE
11/01/2016	617915			1	0	0	222039	0	0	SABINE
10/01/2016	617915			1	0	0	223653	0	0	SABINE
09/01/2016	617915			2	0	0	226145	0	0	SABINE
08/01/2016	617915			1	0	0	1123	0	0	SABINE

 

 

 

 

 

 

LEASE\UNIT\WELL PRODUCTION

RPT DATE	LUW CODE		STORAGE FAC		DOC USE		WELL CNT		OPENING STK		OIL PROD(BBL)		GAS PROD(MCF)		DISPOSITION		CLOSING STK		PARISH
08/01/2019		617192						2		0		0		45581		0		0	SABINE
07/01/2019		617192						2		0		0		46599		0		0	SABINE
06/01/2019		617192						2		0		0		51325		0		0	SABINE
05/01/2019		617192						2		0		0		53829		0		0	SABINE
04/01/2019		617192						2		0		0		55873		0		0	SABINE
03/01/2019		617192						2		0		0		59876		0		0	SABINE
02/01/2019		617192						2		0		0		62119		0		0	SABINE
01/01/2019		617192						2		0		0		69432		0		0	SABINE
12/01/2018		617192						2		0		0		73791		0		0	SABINE
11/01/2018		617192						1		0		0		79922		0		0	SABINE
10/01/2018		617192						1		0		0		91173		0		0	SABINE
09/01/2018		617192						1		0		0		100750		0		0	SABINE
08/01/2018		617192						1		0		0		116971		0		0	SABINE
07/01/2018		617192						1		0		0		140380		0		0	SABINE
06/01/2018		617192						1		0		0		149063		0		0	SABINE
05/01/2018		617192						1		0		0		174252		0		0	SABINE
04/01/2018		617192						1		0		0		178708		0		0	SABINE
03/01/2018		617192						1		0		0		202136		0		0	SABINE
02/01/2018		617192						1		0		0		196947		0		0	SABINE
01/01/2018		617192						2		0		0		222554		0		0	SABINE
12/01/2017		617192						1		0		0		216630		0		0	SABINE
11/01/2017		617192						1		0		0		214807		0		0	SABINE
10/01/2017		617192						1		0		0		225213		0		0	SABINE
09/01/2017		617192						1		0		0		218014		0		0	SABINE
08/01/2017		617192						1		0		0		238427		0		0	SABINE
07/01/2017		617192						1		0		0		227157		0		0	SABINE
06/01/2017		617192						1		0		0		209099		0		0	SABINE
05/01/2017		617192						1		0		0		219067		0		0	SABINE
04/01/2017		617192						1		0		0		208689		0		0	SABINE
03/01/2017		617192						1		0		0		215690		0		0	SABINE
02/01/2017		617192						1		0		0		190827		0		0	SABINE
01/01/2017		617192						2		0		0		212794		0		0	SABINE
12/01/2016		617192						2		0		0		216621		0		0	SABINE
11/01/2016		617192						2		0		0		211945		0		0	SABINE
10/01/2016		617192						2		0		0		233875		0		0	SABINE
09/01/2016		617192						2		0		0		240458		0		0	SABINE
08/01/2016		617192						2		0		0		7944		0		0	SABINE

 

 

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Permalink Reply by Steve P on October 14, 2019 at 14:05

thanks, Skip

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Permalink Reply by Dion Warr, CPL on October 17, 2019 at 6:52

Skip:

One thing to mention in this above case is that there is an existing producing unit well in the SUPP (SN 243197; Las Ormigas 2 #1) which although mature production was not marginal in any respect at the time of the completion of the James Hall 2-35 HC #1-Alt (SN 249632) on 8/31/2016.  This production is "tilting" the production away from the ratios that you state above - we can derive the "implied" continued production of that well here (at least until another well is drilled which will foul a straightforward analysis - at which point only the meters on the wells would need to be accessed):

Prod. Month	PP Unit Production LUW 617192	I Unit Production LUW 617915	Total SUI/SUPP Production	SN 249632 - I Unit Allocation	SN 249632 - PP Unit Allocation	SN 249632 - Expected PP Unit Production (Ratio)	"Implied" SN 243197 Production
8/1/2019	45,581	43,229	88,810	0.5236	0.4764	42,309	3,272
7/1/2019	46,599	44,033	90,632	0.5236	0.4764	43,177	3,422
6/1/2019	51,325	47,401	98,726	0.5236	0.4764	47,033	4,292
5/1/2019	53,829	51,782	105,611	0.5236	0.4764	50,313	3,516
4/1/2019	55,873	53,122	108,995	0.5236	0.4764	51,925	3,948
3/1/2019	59,876	57,975	117,851	0.5236	0.4764	56,144	3,732
2/1/2019	62,119	59,609	121,728	0.5236	0.4764	57,991	4,128
1/1/2019	69,432	67,969	137,401	0.5236	0.4764	65,458	3,974
12/1/2018	73,791	71,660	145,451	0.5236	0.4764	69,293	4,498
11/1/2018	79,922	77,936	157,858	0.5236	0.4764	75,204	4,718
10/1/2018	91,173	91,363	182,536	0.5236	0.4764	86,960	4,213
9/1/2018	100,750	101,610	202,360	0.5236	0.4764	96,404	4,346
8/1/2018	116,971	119,132	236,103	0.5236	0.4764	112,479	4,492
7/1/2018	140,380	143,840	284,220	0.5236	0.4764	135,402	4,978
6/1/2018	149,063	153,834	302,897	0.5236	0.4764	144,300	4,763
5/1/2018	174,252	178,932	353,184	0.5236	0.4764	168,257	5,995
4/1/2018	178,708	186,600	365,308	0.5236	0.4764	174,033	4,675
3/1/2018	202,136	211,120	413,256	0.5236	0.4764	196,875	5,261
2/1/2018	196,947	205,449	402,396	0.5236	0.4764	191,701	5,246
1/1/2018	222,554	232,644	455,198	0.5236	0.4764	216,856	5,698
12/1/2017	216,630	223,756	440,386	0.5236	0.4764	209,800	6,830
11/1/2017	214,807	220,657	435,464	0.5236	0.4764	207,455	7,352
10/1/2017	225,213	227,890	453,103	0.5236	0.4764	215,858	9,355
9/1/2017	218,014	220,222	438,236	0.5236	0.4764	208,776	9,238
8/1/2017	238,427	231,237	469,664	0.5236	0.4764	223,748	14,679
7/1/2017	227,157	230,569	457,726	0.5236	0.4764	218,061	9,096
6/1/2017	209,099	220,823	429,922	0.5236	0.4764	204,815	4,284
5/1/2017	219,067	232,077	451,144	0.5236	0.4764	214,925	4,142
4/1/2017	208,689	222,324	431,013	0.5236	0.4764	205,335	3,354
3/1/2017	215,690	227,886	443,576	0.5236	0.4764	211,320	4,370
2/1/2017	190,827	205,013	395,840	0.5236	0.4764	188,578	2,249
1/1/2017	212,794	228,279	441,073	0.5236	0.4764	210,127	2,667
12/1/2016	216,621	229,815	446,436	0.5236	0.4764	212,682	3,939
11/1/2016	211,945	222,039	433,984	0.5236	0.4764	206,750	5,195
10/1/2016	233,875	223,653	457,528	0.5236	0.4764	217,966	15,909
9/1/2016	240,458	226,145	466,603	0.5236	0.4764	222,290

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Permalink Reply by Skip Peel - Mineral Consultant on October 17, 2019 at 7:12

Yes, Section 2 has a unit well drilled in 2011 that would be included in that LUW production volume.  The average for the three months prior to the new wells being turned to sales was ~9400 mcf.

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Permalink Reply by Dion Warr, CPL on October 17, 2019 at 9:07

Skip:

Based upon the rightmost column (implied production), it appears to be further along now - from 300 mcfd to 110-140 mcfd at current.

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Permalink Reply by Skip Peel - Mineral Consultant on October 17, 2019 at 9:17

That could possibly be why there are new wells.  In the past we have discussed the fact that Comstock had taken well permits in a group of sections that were allowed to expire and then re-permitted for seven or more years.  I think Steve P. had a least one discussion on that.  However he also had the well with astonishingly slow decline also so I guess things even out.  :-)

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Permalink Reply by Steve P on October 17, 2019 at 14:48

So I have great hopes for the 2 Vine wells in 2-9-12,  The currently producing CUL was the one with the flat production decline for the first 12 months.  For the 2 wells now being drilled, on is in the Haynesville and the other is in the Bossier.  The Bossier is supposed to be particularly excellent in this area of northern Sabine Parish 

The Comstock well is also a CUL that had the saga of permits every 6 months for 3 or 4 years and they never drilled.  That well is in the Stanley area of DeSoto Parish, and it is in a large circle with either no HA wells, or a few scattered pretty low quality early wells.  The well in 26-12-15 (which is producing 35-12-15 and 2-11-15) looks like a pretty good well so far.  Of course, I have a very small parcel of minerals and its a 50 year old lease at 1/8th, so it won’t bring too much joy to the household.  But I’m thankful for anything I get.

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