millions wasted on bonus payments!

  I guess they drill either northwest or southeast now where I live, belmont county ohio, for some reason.. I used to hear of them drilling several wells in a star shaped pattern from the center. That idea seems to have changed now with the northwest southeast thing. I used to think that everyone inside the star would be included in the drilling unit.  With wells going northwest or southeast only a thin strip of land would likely be included. Seems like a persons odds of being included are pretty slim with this scenario. If that's true seems like they spent gobs of money on bonus payments for absolutely nothing? It also makes some of those offers to buy 1/2 of your royalty rights seem somewhat more attractive when you consider what your odds of being included in a drilling probably are.

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Permalink Reply by deutchen on May 24, 2013 at 12:42pm

your both right I'm sure. No reason to be hasty now. Just sit back & see what's happening. It's really beginning to happen near me now, belmont county, union twp. Pipelines going in from here to Cadiz. The Shugert wells. & Eagle creek wells drilling now. All within 2 miles of me near Morristown.

Permalink Reply by Keith A Williams on May 23, 2013 at 3:29pm

John,

If the company plans well, there is very little land that is not used! These companies place a pad in the center of a unit and they can drill 6 to 8 wells from that pad. 3 or 4 go NNW and the same number go SSE.

Think of this unit as a domino (maybe a long skinny one). Now imagine you place that domino in the center of a table. Any angle is fine. Even with the domino not square with the table, you can place a domino on each side of it. You can place a domino above it and below it. You can cover the table with dominos. There will be no holes. No wasted leases.

Look at maps of the wells in North Dakota. Also if you look at a map of Carroll county Ohio, you will see that CHK has done this in areas. Areas that they call the core of the core.

That said, the companies are not going to do this everywhere. There will be areas that will not be drilled. There are a lot of wasted leases. That is part of their world.

HTH

Keith

Permalink Reply by Rick on May 26, 2013 at 12:49am

Keith, would it not be wiser to place the pad on the end of a unit instead of the center? That way they can drill one lateral in one unit to the northwest, and one lateral in a second unit to the southeast ... both from one pad. That would enable them to HBP two units... over 1200 acres with two laterals and only one pad? Seems to me that would be much more cost efficient. I dont believe there is a law that requires that a unit must have a pad or vertical shaft on it..

Permalink Reply by H.W. Plainview on May 26, 2013 at 5:34am

Rick,

The pads are at the end of the units. Most of the operators will have one large pad site that has one unit running NW and the other unit running SE. As mentioned, each unit might feature 4 laterals or even more if they decide to increase density. The pad site will typically sit right on the edge of both drilling units which allows them to maximize the length of their laterals while minimizing surface use.

Permalink Reply by Ripley's Believe it or Not on May 23, 2013 at 5:51pm

Well if your leased to Gulfport and you get an offer from Westhawk for your remaining mineral rights and you sell them,, that means Gulfport owns them all!! So for being a pretty slim chance of being in a unit you wouldnt think Westhawk ( aka Gulfport ) would waste there money?? just a thought

Permalink Reply by John OBrien, landowner advocate on May 24, 2013 at 12:17am

about a 50 50 chance, always was

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