Comment

Comment by Oliver Perry on June 7, 2013 at 8:01am

I'm not so sure the vertical wells listed are test wells Sam. If you look at the "well type" listed on the permits, they are all listed as being "combination oil & gas. I think they are likely shallow wells, targeting formations like the Speechley ( 2,200' ) such as the Byler Well in Venango County for which I attached the well plat. I could be wrong, I don't have the plats for those wells, but that is my guess.

Interstate%20Gas%20Byler%20Unit%20Well%20Plat.pdf

Comment by sldouglass on June 7, 2013 at 6:29am

Oliver Perry was able to copy a good clipping.
Not that 8 out of 10 permits are for vertical test wells to be drilled. Real production in the shales comes from horizontal wells. The vertical wells only draw from a short distance and are useful to confirm seismic etc.

Comment by Oliver Perry on June 7, 2013 at 1:05am

I attached the drilling permits issued in Crawford County for 2013.

Crawford%20County%20Drilling%20Permits%20-%202013.pdf

Comment by sldouglass on June 6, 2013 at 3:52pm

According to DEP
Not much action in Crawford County
http://files.dep.state.pa.us/OilGas/BOGM/BOGMPortalFiles/OilGasRepo...
http://files.dep.state.pa.us/OilGas/BOGM/BOGMPortalFiles/OilGasRepo...

http://www.portal.state.pa.us/portal/server.pt/community/marcellus_...

http://www.portal.state.pa.us/portal/server.pt/community/oil_and_ga...

Comment by David Hunt on June 6, 2013 at 2:06pm

Don I get e notices from the DEP on permits for Crawford and haven't seen anything for that area.I think it is just rumor  I have also heard there was one going in on Beaver Center rd a wile back but that was false.

Are you Mike and Rodgers brother? 

Comment by Don Graham on June 6, 2013 at 12:47pm

Dan, our attorney who reviews oil/gas leases originally said the site was off Maples RD, Linesville.  Later he said it was more toward Airport RD.  He said there was a lot of activity there.  We drove Maples and didn't see anything.  So I am at a loss as to whether it has just been permitted or what.

Comment by sldouglass on June 5, 2013 at 8:36am

The web page below should demonstrate that estimating reserves requires a sophisticated effort by experts. The estimating of the value of those reserves requires a crystal ball to figure out when the O&G will be produced in order to establish a present value. Only the producer knows when s/he will produce and s/he might not be sure. Of course if you know you have good stuff under your land, you can be pretty sure that it will be produced at some time.

http://reserve-estimation-houston.com/downloads?utm_campaign=2596%2...

Comment by Dan Driller on June 5, 2013 at 1:06am

Don,  I haven't seen or heard of any activity on Maples Rd. in Linesville, but then again I am mostly just in the area from Rt 6 to Carpenter.  Where did the rumor say the spot was on Maples?

Comment by Dave on June 4, 2013 at 2:37pm

Is the results of the phillps well bad news for crawford county landowners?  I keep reading back and forth things that people post on here?

Comment by sldouglass on June 4, 2013 at 11:05am

While the $16 million is, I think, realistic as a gross return on the sale of dry gas, there are a lot of variables.  If the horizontal line is longer than 4000 feet, then we can assume that production would be greater.  One might assume that the price of wet gas is higher than dry gas, but the leases do not tell how that price will be arrived at.  Wet gas has several constituents which will be separated out and sold for different prices.

Determining asset value is difficult, if not impossible, because you have no idea when the well(s)      affecting your property will be drilled so as to start production.  You might say that gas or oil of wet gas with its several parts that is produced as much as 20 years from now is worth next to nothing today - after you bring it to present value.

You can be pretty certain that one or two wells will be drilled in a unit of 1 or 2 square miles in order to hold the leases in the unit beyond the primary term.  But there would be a lot more drilling to be done after that.  And the reserves available for drilling in Appalachia are vast - maybe 100 years of drilling into not only the Utica and Marcellus, but a number of other strata as you point out.  It will not be all done in a day. And as you know, the dry gas was fine in Pa until the industry found it could make more money sooner going to Ohio and drilling in the Utica.  The dry gas is still good but it will wait.

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