I live in North Rome. We are leased with East. They drilled a vertical well on my neighbor. It appears that chesapeake is going to drill in the surrounding neighborhood. This is on old leases with storage in the lease, my hope is that they wont lock up the area in a storage unit. Bradford co.residents should check out the pipeline that is going in,in Franklin Township. I would like to see the gas companies to share the transportation lines instead of creating a "spider web" effect on our land! Another concern is injection wells. The monies offered for an injection well is low. Texas recieved $250,000 for the hole + $5-$7 per barrel,not $10,000 that has been offered here in Bradford co. Did you know that the state (PA) does not determine the production unit? The gas company determines the way the production unit will lie. Also there is no law stating the size of the production unit (640 acre unit) only what you have stated in your lease is what will protect you and your land.
E&P companies determine the unit based on the geology -- today's methods are so that looking at scientific data, geologists can know where to drill in a given unit for maximum production, instead of drilling holes all over the area.
One of the benefits to drilling Marcellus Wells is that multiple wells can be drilled on one pad (I've seen as many as six) and run out a few thousand feet, offsetting, under various lessed parcels. This is more responsible drilling -- it calls for less land disturbance, but also increases gas production and still delivers royalties to those in the unit, even if the actual equipment is not located on the surface of their land.
On pipelines, there often is sharing that goes on between companies -- but particularly in North East PA were there are fewer lines historically, there is a need to build gahering lines, where gas from various wells meets up, and is transported into larger lines for distribution to the marketplace.
Actually the State sets the Spacing Laws for unit sizes. In TX, the unit size for NG is 640 acres & pooling gets involved and that creates another set of spacing rules etc. LA has a variety of pooling laws that maximize the space and allows for more drilling and roys. LA is king of pooling and unitization.
The well pads are not going to be an issue,as far as a farmer trying to continue farming his land. The issue is going to be the pipelines. The depth of the pipelines and the amount of pipelines running through the property are becoming a problem. We have talked to two of the companies in our area and they have stated that they will NOT share the pipeline.
I am also aware that when six laturals are drilled it will/can drain 640 acres of natural gas. Take a look in Canton,PA. I saw at least six well pads in less than a 2 mile radius. Does this mean the production units will be smaller? A Lawyer told me production units do NOT cross one another.
I understand your frustration on pipelines - an you're right - some companies will not share. But many will sell capacity in their lines to other companies. Let's hope moving forward that we can get gas to market with the least amount of disturbance possible. The important thing to remember -- especially if you are a lease holder -- is that if the gas doesn't get sold, royalties can't be generated.
Exploration companies want to develop property they have leased. With five year leases, this can be challenging, since there is so much to get done to produce a well, ie permtting, siting, geological study, rig scheduling, etc. Sometimes, the amount of acreage that can be "held by production" varies (thats the amount of land a company has access to through its.lease by drilling a well -- work done on your property before the lease expires keeps the lease active beyond the five years).
Many leases call for 160 acres to be held in production per well. This often sounds good to landowners - and sometimes it can be, as it ties up less land, in theory. However, now that drilling companies can work horizontally, and place offsetting wells on one pad, it can make sense for the number of aces held in production to actually be more. Instead of six pads -- one for each well -- and the construction and property disturbance that come from six pads, drillers can put the six wells on one pad, minimize surface disturbance, and get the same or even better rate of return. That however, requires them to hold about 640 acres in production, to allow for development and production of all six lateral lines, which take more space (mostly underground) and time to put in, frac,and produce.
Your lawyer is correct -- production units do not cross one another. When there are multiple pads -- say one for each of our six wells above - the unit space for each well would most likely be smaller - yet counted together, those six pads could actually tie up more land (and limit surface usage much more) than the 640 acres required by one pad with six wells on it.
I live in Litchfield, Bradford County. I seem to be almost the only hold-out in the surrounding 640 acre area. My chief concern is to be free of any drilling, storage, pipes or other activity/permanent structures on my land.
I know many who unwittingly signed awful leases - they just seem to accept being messed around as their inevitable fate. I suspect that once the true costs [traffic, taxes, perhaps crime, housing pressure, noise, pollution and so forth] become apparent and balanced with the temporary jobs and modest payments for small land owners they will regret all of this.
The State seems to do little to protect small land owners leaving the entire mess to them, from water testing to lease signing. It interferes more in how you extend your house.
What makes this site so great? Well, I think it's the fact that, quite frankly, we all have a lot at stake in this thing they call shale. But beyond that, this site is made up of individuals who have worked hard for that little yard we call home. Or, that farm on which blood, sweat and tears have fallen.[ Read More ]