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Permalink Reply by Skip Peel - Mineral Consultant on October 29, 2022 at 10:52

Offers based on current royalty income multiplied for a number of months is an old tradition that is no longer used by most buyers.  It is an approach looking for an uninformed or desperate mineral owner.  The focus of buyers is Haynesville/Bossier reserves.  Both are pretty much no risk situations.  It is sometime said and largely true that there are no dry holes in the Haynesville Shale.  Therefore the question should be:  how many future wells would your mineral interest expect to get over time?  If you have only Haynesville reserves, you should get between 8 and 6 wells total.  Just subtract how many are existing.  If you have Haynesville and Bossier shale reserves, double that.  That and your number of acres owned and the royalty fraction in your lease along with any public record indicating new wells in the near future will largely determine the value.  There are a few other considerations but that gets into some specific details.  Your minerals are an asset and should be managed and treated as such.  Some mineral owners would benefit from a sale.

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Permalink Reply by Skip Peel - Mineral Consultant on October 29, 2022 at 12:03

Reservoir engineers are not cheap.  And are not always accurate in their opinions.  I've seen that more than once.

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Permalink Reply by Skip Peel - Mineral Consultant on October 29, 2022 at 13:58

I'm sure if a member wishes to potentially spend a few tens of thousands of dollars on a reservoir engineer, you will be happy to refer them.  Otherwise I think it is accurate and considerably less expensive to simply review where Haynesville operators are drilling Bossier wells and where they are not.  That is not only cheap, it is no cost.

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Permalink Reply by Skip Peel - Mineral Consultant on October 30, 2022 at 1:58

In my opinion, it is a waste of time and money when anyone who reviews the alternate well applications in the Commissioner's public hearing agenda would know where companies are applying to drill Bossier wells.  They are labeled on the plats.  Additionally, the Bossier is as continuously productive as the Haynesville across the majority of the basin.  I think the operators have the science they require to drill Bossier wells and would not be permitting them if they didn't plan to drill them.  If you know a reservoir engineer that works cheap, by all means post their name and contact info.

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Permalink Reply by Skip Peel - Mineral Consultant on October 30, 2022 at 3:09

Those that wish to spend money with a reservoir engineer or petroleum engineer may do so however it will not provide any benefit that can not be had for free.  Those who want to know the prospective nature of the Mid-Bossier only need to look to the public record.

Permalink Reply by Skip Peel - Mineral Consultant on October 30, 2022 at 4:06

So, you decided to not stop posting?  That's okay as it appears it's your nerve that is struck.  I have assisted dozens of mineral owners in the sale of their minerals and not once has a buyer paid for a report by a reservoir engineer.  In only one instance did a mineral owner get such a report and it turned out to be wildly inaccurate as that engineer later admitted.  It is a waste of time and money.

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Permalink Reply by john goodday on October 30, 2022 at 13:08

T15N-R10W ----- Where are the nearest Bossier wells to this township ?

 

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Permalink Reply by Skip Peel - Mineral Consultant on October 30, 2022 at 13:21

john, by my tracking spreadsheet based on alternate well applications - Sections 9&16&21 -14N-9W.  Aethon has permitted and drilled Bossier tests in 15N-10W and in 15N-13W but those wells have not reported Initial Production data as yet.  Aethon has also applied to the state to redefine the Haynesville depth definition in a number of their operated units in 15N and 14N townships.  At this time, all townships 13N and south are experiencing operator applications for Bossier wells with the exception of the low porosity Logansport area which is not economic for Haynesville reserves.  We will have to wait a little longer to see if industry activity signals that the Bossier is economic north of 13N.  Those 15N wells represent a significant step out to the north.

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Permalink Reply by john goodday on October 30, 2022 at 13:37

Thanks for that information.  Do you recall what section in T15N-R10W - Aethon drill Bossier test wells?

Also - what applications were filed to redefine the Haynesville depth definition in 15N?  I thought that was pretty well determined?

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Permalink Reply by Skip Peel - Mineral Consultant on October 30, 2022 at 13:43

john, I'll hold on to the specifics of the Aethon Bossier test wells for a while as having that depth of information is what I get paid for.  The Aethon applications to redefine the depth of their Haynesville units are covered in applications 22-494 and 22-563 of the Commissioner's public hearing schedule.  You can find those on SONRIS.

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