Pipeline thru property

Does a proposed pipeline running thru your property increase your chances of being put into a unit & a possible well pad?

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0l1a6laz7smpfPermalink Reply by 0l1a6laz7smpf on September 11, 2010 at 6:50am
That's a great question Sal! I hope someone with some expertise will answer that question...I would also like to know that!
Permalink Reply by Mike freed on November 26, 2011 at 10:40am

It is hard to say if they will unitize you or not because of a pipeline, I think they will unitize you just to assure they maintain control over your property and this allows them to pay the shut in fee per acer, which is much less than a new lease fee.  However, they have known where they plan to run the pipeline for a while and it is likely that any well they dig will be placed near the proposed or actual pipeline. 

Permalink Reply by brat on November 26, 2011 at 11:12am

Yes, and tho slightly off topic,  what is the norm for a tresspass fee for a pipeline put across your property without a lease of any kind?

Permalink Reply by Jack Straw on November 26, 2011 at 4:13pm

All other things equal, access to the infrastructure necessary to quickly produce a well is an obvious plus.

Drilling a Marcellus (or Utica) well is a very expensive prospect, the sooner that the operator of the well can get into a pipeline, the sooner they can start recovering their investment.

The sooner they can start recovering their investment, the sooner they can producively reinvest.

It is the time value of money that helps drive investment decisions.

All other things equal, a prudent operator would chose to drill near to an existing (or soon to be installed) pipeline.

If you have already signed the pipeline agreemnet, I hope that you did your "homework" and got a good deal.

If you have not yet signed a pipeline agreemnet, I hope that you do your "homework" and get the best deal possible.

We are all in this individually, but we are all in this together.

Best of luck.

JS

 

 

 

 

 

 

Permalink Reply by Elsie Fox on November 26, 2011 at 5:11pm

Am I right to assume that they won't be using existing natural gas transmission lines because the wells in our area will likely produce a mixture of products?

Permalink Reply by Jack Straw on November 27, 2011 at 2:17pm

RE: “Am I right to assume that they won't be using existing natural gas transmission lines because the wells in our area will likely produce a mixture of products?”

 

No simple answer.

Not sure where your area is located.

Not sure what wells in your area can be expected to produce; in volume and types of hydrocarbons other than dry gas.

Not sure how many wells in your area will ultimately produce (in addition to dry gas) natural gas liquids (NGLs) and oil.

Not sure what your local pipeline operator is willing to accept in their pipeline.

 

Having gotten all of the above “negatives” out of way, I will attempt to provide something of use.

 

There is potential for processing of the gas stream at (or near) the wellhead in order to separate NGLs and oil and remove water and water vapor. The valuable liquid products then trucked off.

 

If/when there are a sufficient number of wells drilled and if/when these wells produce sufficient quantities of NGLs and/or oil , then a local pipeline gathering system may be installed and a processing plant built.

 

A lot of ifs and maybes. Time and circumstances will determine what ultimately occurs.

 

Below is a site presenting a good explanation of natural gas processing.

http://www.naturalgas.org/naturalgas/processing_ng.asp#seperateng

 

JS

2s72s0k9mm8gdPermalink Reply by 2s72s0k9mm8gd on November 27, 2011 at 3:19pm

Thanks , again , Mr. Straw. This is the kind of info we hunger for. As more and more wellsites appear, and we are exposed to all these different contraptions associated with them, it's important to know what we are looking at! Where can I find a pic of one of those 400 barrel oil tanks?

Sure beats the crap out of all the bickering and B.S. we are subjected too all too frequently here!

You have been a breath of fresh air sir....Those of us leased and awaiting drilling say Thank You!

 

Permalink Reply by Elsie Fox on November 27, 2011 at 6:46pm

Thanks so much for your educated reply.  I'm in eastern Belmont County (supposedly a 'wet gas' area, but only a drill will tell what may or may not be under me, lol).  And there's a Columbia Gas transmission line running through the middle of my place.   

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