24 wells per pad

http://www.naturalgasintel.com/articles/98004-appalachian-basin-sti...   this is from consols website.  how would you like to own 50 acres in a unit w 24 wells drilled?

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Permalink Reply by David Mohn on April 11, 2014 at 1:02pm

What it could mean is that instead of a 640 acre drilling unit, it could be a 3840 acre drilling unit.  Something to think about if they approach you about a drilling pad on your land.  A 24 well drilling pad might take up 25 of your 50 acres of land?    I am not sure I would want a pad that size on my land?  

I can see the cost savings by having one big pad for the company.  I am all for cutting cost however, not sure I would want it on my 65 acres of land?  Just saying. 

Permalink Reply by mark ondrusek on April 11, 2014 at 1:06pm

I am no expert but I don't think that would be the case.  they are talking about drilling three different strata from the same pad!

Permalink Reply by mark ondrusek on April 11, 2014 at 1:08pm

yes,  that is what I get from article.   would like to hear from somebody in the business and get their opinion!

Permalink Reply by Tim Tarr on April 11, 2014 at 5:31pm

Yes, Lets say you have Utica, Marcellus and Genesseo/burket Layers. If you have 50 acres of O&G rights. You now have 150 (50x3) acres of shale rights. So if they use 100 acre spacing and 12 wells that's 1200 acre unit for each layer. 36 wells on one pad; 12 for each layer.

Now it's very unlikely 18 or more of those will be drilled at same time or even within 10 years. What it really does is make that infrastructure cost (pipelines, well pads...)  more economic and will cause 1st layer to get developed faster.

Keep in mind each layer will have different characteristics. You may even get all three layers drilled around same time with wells into each layer. They can use one Vertical for all 3 laterals. Expensive to drill and get all 3 in production, from 1 vertical at the same time. probably will plug one Horizontal than drill another Horizontal into next layer.

Permalink Reply by Doug Duffield on April 11, 2014 at 8:56pm

Why would they shut down a Marcellus well to use the same vertical? New wells in different formations new verticals and horizontals based on the "standard" 30 yr life of a Marcellus well. Cabot has already drilled and completed upper and lower Marcellus wells and zipper fracked them, both from different verticals, just saying.

Permalink Reply by Tim Tarr on April 11, 2014 at 9:34pm

Doug,

You are correct that's why your Grand kids will be getting Royalties. Now if gas prices are high enough they just may drill like crazy but chances of that are very low. The Market would be over supplied again.

Good thing is don't have to worry about Royalties going to near nothing in a few years !!

Permalink Reply by cj wyalusing on April 11, 2014 at 9:23pm

You better hope it is not chp.

Permalink Reply by catt on April 11, 2014 at 10:27pm

Also remember what you signed in your lease.......if you  have signed for all layers to be drilled. But some leases are just for the Utica and Marcellus. Rights to the additional layers would have to be purchased by the O&G company. I'm not to sure about all of this.

Permalink Reply by Tim Tarr on April 11, 2014 at 10:39pm

All layers are leased, unless your lease has a clause that states it's only for specific Strata.

Permalink Reply by Tim Tarr on April 12, 2014 at 1:36pm

    Utica,

"... All layers are leased... "

In Eastern Ohio, over 100,000 acres, maybe up to 200,000 acres,

were leased using the A.L.O.V. Lease language.

Typically, it states from the "Queenston Formation and lower, ONLY".

All layers are leased, unless your lease has a clause that states it's only for specific Strata.

From the Queenston Formation and lower is specific. Everything is leased from Queenston and lower.

It appears that this multi-play stacked lateral may be very localized due to unique and varying geology.

http://phx.corporate-ir.net/phoenix.zhtml?c=66439&p=irol-presen...

Take a look at page 5 of the 3/24/14 Howard Weil Presentation. Link above.

There may be exceptions to this, but basically. If Utica is less than 8000 feet deep, Upper Devonian Shales are too shallow. Could get interesting below Utica but time will tell. Utica is still in Exploration stage give it a few years.

Keeping in mind there are still lots of reservoir rock where those "Shallow" shales may be source rock for Oil and gas for some "Conventional" plays.

Permalink Reply by Todd on April 12, 2014 at 4:27pm
Tim,

"Where the Utica < 8000' deep, the UD is too shallow to develop" - Did you read this somewhere or do you make this assertion yourself based on your research?

Thanks, Todd
Permalink Reply by Tim Tarr on April 12, 2014 at 6:21pm

Todd,

    My own research. Using several different company Presentations and Utica Depth maps. Notice I said Upper Devonian and not Marcellus. Marcellus is in lower middle Devonian.

Something new and very interesting, Pennsylvania State University geologist Dr. Terry Engelder mentioned Dunkirk/Huron Shale in SW Pa. Listen closely or you'll miss it.

http://www.youtube.com/watch?v=GY-xK3NCz40

That really surprised me. I was sure it didn't go into SW Pa. It would help to account for Venango Oil sands much better than Rhinestreet does.

 

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