Haynesville Production Decline vs. Royalty Calculator Estimates
Shalers,
I hear that Haynesville wells are supposed to decline a great bit after the first year...but have wells been in production long enough to prove this?
When I go to natural gas royalty calculators on the internet they don't make provision for such steep declines, and I suppose the reason for not doing so is that they are set on 'average well decline'. Is there a place to go to estimate royalties from the Haynesville?
Thanks,
Jeff in Belgium
I hear that Haynesville wells are supposed to decline a great bit after the first year...but have wells been in production long enough to prove this?
When I go to natural gas royalty calculators on the internet they don't make provision for such steep declines, and I suppose the reason for not doing so is that they are set on 'average well decline'. Is there a place to go to estimate royalties from the Haynesville?
Thanks,
Jeff in Belgium
Views: 184
Replies to This Discussion
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Permalink Reply by Jon Williamson on
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Now that I think about it. I would probably use $4 for the first year and $5-$7 for the years following.
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yup
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Permalink Reply by JeffNParis on
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Jon,
What do these figures mean if they put more than one well on the property. Would the figures be the same for each well? Spacing is figured at 60 acres per well? So if there were 3 wells it'd be three times the amount? Or just that amount for the entire acreage?
Jeff
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Jeff those figures would be for just one well. If you were in a productive area you would likely get 4-8 wells per section. It's always best to be conservative though, when placing a value on an interest.
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Permalink Reply by JeffNParis on
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Ok...thanks. One more question Jon. If you're part of a 640 acre section, do you get paid for each well producing in that section? Thanks for all your help...it is disappointing to see the decline rate but I guess you take the bad with the good!
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Permalink Reply by The_Baron on -
YOu get paid for each well in your unit. Most units are on section lines, but not all.
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Permalink Reply by lanadan Ds3 on
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Jeff,
Go to: www.haynesvilleplay.com/2009/03/decline-curves.html
Click on the decline curve graph for larger size. Goodrich Petroleum shows 3 models, with 7.0, 10.0, and 13.0 MMcf/d of IP (unitial production) wells.
This is right in line with other "guestimates" that I have seen.
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Permalink Reply by Skip Peel - Mineral Consultant on
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Goodrich is using Chesapeake's decline curve graph. The two are identical.
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Permalink Reply by alleyboy on
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Seems like the royalty a small tract(1/2 acre) owner will get over time will be very small.
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