Replies to This Discussion

Permalink Reply by cheliped on January 15, 2013 at 3:16pm

Oliver,

As i look over the different plats i notice that they are all different sizes.  It seems that the smallest is 195 acres and the largest is 450+.  I know the largest size depends on the lease - either 640 or 1280, but I am wondering how small a unit can be.  any info would be greatly appreciated.

Permalink Reply by Oliver Perry on January 16, 2013 at 2:40am

cheliped,

I really don't know any more about it than you, but I think they generally have a 500' minimum on each side of the horizontal, and a 500' radius around the top hole. So for a single well, with a 5,000' long horizontal leg, I would assume the smallest a unit could be would be about 1,000' X  5,500' or 126 acres.

Obviously, a shorter lateral would reduce the minimum unit size, but I think 5,000' is about average.

Permalink Reply by cheliped on January 16, 2013 at 7:28am

Thanks - that makes sense to me. Maybe the smaller unit size has something to do with areas where people won't sign a lease and the drilling company needs to reduce the size of the unit. I would think that there are lots of holes where people refuse to sign.

Permalink Reply by Tim Tarr on January 16, 2013 at 9:07am

Oliver,

Thanks for posting that. SWEPI sure has better well plats than RRC.

Permalink Reply by cheliped on January 16, 2013 at 10:40am

Tim,

Does RRC have small unit sizes? if so what are the the unit acre size?

Permalink Reply by Oliver Perry on January 16, 2013 at 4:57pm

cheliped,

I have attached two Chesapeake unit maps from over in Ohio, one is only 104 acres, the other 129 acres. Check them out.

Attachments:

• Chesapeake Murvay Unit Map.pdf, 1.1 MB
• Chesapeake Riffle Unit Map.pdf, 2 MB

Permalink Reply by cheliped on January 17, 2013 at 1:45am

The big question now is why are the units so small?  I always thought that it was not economical for them to drill such small units. 

Permalink Reply by Oliver Perry on January 17, 2013 at 3:14am

I would guess they start out small with only one well as sort of a test well to find out the potential for the area. The units can always be enlarged in the future if the well has good production, and they decide to drill additional wells. I think the pads are built to a size with this possible unit enlargement in mind.

The unit maps show a sketch of the pad, and that shows the possible future wells.

Permalink Reply by cheliped on January 17, 2013 at 3:25am

I am curious about it because there are unleashed parcels around me.

Permalink Reply by Oliver Perry on January 17, 2013 at 3:49am

Using the Halterlein site as an example, the permitting for those wells started last July. Yet Swepi was still leasing around that site up until a couple of months ago. I think they were still gathering the final parcels needed to form their units. 

So if somebody has an unleased parcel in close proximity to a new well that is in the permitting process, that puts them in a very good position for negotiating a lease with the operator of that new well. 

I hope to be in that very situation sometime in the next couple of years because my acreage is currently not leased. 

Permalink Reply by FairMktValue on July 31, 2013 at 12:58am

Interesting lookiing at the pad sketch. Wells marked HM, HD and HS.

I believe you may have mentioned this somewhere but I am assuming HM would be marcellus D & S  - other strata.?

Like a broken record, that gets me back to "stacked pays" . Lot of value there that they just don't want to pay for. 

Permalink Reply by Oliver Perry on July 31, 2013 at 10:10am

M is for Marcellus, D is for Utica, and S is for Burket.

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