Replies to This Discussion

Permalink Reply by Tom Brian on July 20, 2011 at 7:41am

Shell drilled one well last year in Russia Down 17000' an over 38000'  thats some where around 7 1/2 miles so the 4000' that is the norm in this area maybe changing fast , hard to keep up with pace of happin's . but that don't keep them from happing.   What would be the size of that unit with a dozen or two wells on the pad?

Permalink Reply by paleface on July 20, 2011 at 11:25am

 I think the standard 640 acre unit is 1 square mile ?

Permalink Reply by Brian V. on July 22, 2011 at 8:19am

I'd really love to see some actual data on this issue. I think overall it would be better to have bigger units because the surface disturbance would be almost half. I realize an individuals person interest or percentage of a well would decrease but at the same time in theory more gas would be produced and they would be participating in more wells from the one unit. I'd really like to see some numbers though. This seems to have two benefits to the drillers. 1. Less cost for well pad construction. 2. They can lock up more land. and maybe a third if it's true they can get better flow rates with longer laterals, which is also good for the mineral owner. I guess I would be in favor of such an ammendment if all my land was in the unit. If all my land was not in the unit I would trade my signing of on the bigger unit for a quality pugh clause. It seems fair.

 

It really amazes me they can drill a mile down and then turn the direction and keep drilling for who know how far. It's really some amazing engineering.

Permalink Reply by N Bohl on July 26, 2011 at 1:26am

I agree - more information is needed but if the overall production is the same or more and there are fewer pads that seems like a very good thing. I am all for less surface disturbance - plus that might add some overall value to land in the county in the longer term. 4th on the list for the drillers may be less overall maintence and pipline work? It is hard to imagine Sheel getting everyone on board though. Wouldn't they need anyone with a 640 acre cap stated on their lease to sign on in the proposed larger unit area? Was that 640 acre cap a carrott for the lease signers? I have a vague memory of at least one lawyer saying 3 years ago to me that it was a good thing to have that limit stated. I think State law has a cap on the low end for unit sizing but not the high end.

Permalink Reply by Brian Day on July 26, 2011 at 1:44am

I am not certain, but top leases signed by people with East three years ago may not have had a limit of 640 acres per unit.  The older leases like mine generally do.

Permalink Reply by N Bohl on July 26, 2011 at 8:51am

At least some of the East leases from slightly over a year ago had the limit of 640 acres stated.

Permalink Reply by Lynn Wigglesworth on July 26, 2011 at 12:12pm

I have a copy of the East lease from 10/09 and it has the 640 acre unit stated.

Permalink Reply by Doug Pierson on August 3, 2011 at 1:20am

So, the landman from Shell finally sends us a copy of there proposed amendment.  They kept the unit size at 640 acres after all, but the red flags I see is in their proposed shut-in clause.  There's no time limit specified.  Anyone have any good wording in their shut-in clause that they'd care to share that contains a time limit and/or penalty that they actually got a company to agree to?  It's time for a little push back.

Permalink Reply by Lynn Wigglesworth on August 3, 2011 at 1:30am

If you get Shell to agree to any kind of decent shut-in clause, let us know! Their standard lease has a $5/acre/year shut-in with no time limit.

Permalink Reply by Lynn Wigglesworth on August 3, 2011 at 2:46am

Betty; is that lease with Shell?

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