Hamilton County, KS - Oil & Gas Discussion archives


#1

Hamilton County, KS oil & gas discussion group. Share your experience regarding lease bonus, royalty rates, drilling activity, and oil & gas news.


#2

I have recently received a flurry of offers to purchase my natural gas interests in Hamilton County (also Finney and Stafford. Anyone else? I don't intend to sell any of these interests, but my investigations about the interest seems to have been stimulated by Kansas' recent approval of ATU formations in the tight gas areas, Has anyone else had similar experience in the past few months?


#3

A few years ago, I received offers about once a month, but nothing recently. My sister owns property about twenty miles from mine and received an offer last week. We always turn them down.


#4

I have a small mineral interest in Sec. 27, 25S 42W. I have not received any lease or purchase offers. Is there any action near me?

What is ATU?


#5

An ATU is an "Alternative Tract Unit". I'm no expert, but as I understand it, a company can file with the State (in this case Kansas" for permission to treat a portion of the gas field that has multiple wells in various states of production as well as abandoned and plugged wells. The companies holding the leases petition the state for the right to treat a defined field as a "unit", with each owner receiving a share of any minerals based on the terms of their existing leases. If 75% of all mineral owners in the "tract" agree, then the state will approve the "unitizing" of that defined field. If they don't get 75%, then the unitizing eill noy happen. Most of the the fields in the proposed areas have been in pretty high production for many years, and have been significantly diminished in the last 3 or 4 years. The operators tell us that this particular area is "tight", and that they intend to frack the area if formation of an ATU is approved. I'm wary of this, but also concerned about the significant reduction of income from these wells of late. My father always told me to be very wary of unitizing, and I am. But there is a deadline rapidly approaching, and I'm not yet sure what I'm going to do. BP has held these leases for a long time, but recently sold them off to Linn last year. All of my leases are undivided interests with my 3 siblings, and not sure what they will do. I guess I'm glad that they are at least interested in fracking this area. One concern that I have is that I have a few good producing wells close to the perimeter of the proposed ATU, and the geology suggests that there could be drainage from my perimeter wells into the proposed ATU. An ATU is to the benefit of the company if adjacent wells drain into the ATU, but if there is significant flow of the tight gas, some could benefit, but in a way, some others could lose. Fracking is changing the game in oil and gas. I'm very suspicious that Linn wants to unitize this area in which I have producing wells both in and adjacent to the proposed ATU. I think I need a lawyer! What ever happend to the Nordlings? They are probably dead by now, but I wonder if their company still exists?


#6

Thanks for the definition, Mary. I'm familiar with the term Unitizing - I'm in Southern Oklahoma - and it's done for secondary recovery waterflooding. In my experience it's been good. The waterflood has upped production substantially. As you probably know they inject saltwater to force out oil that was previously inaccessable.

Bernie Nordling is deceased however Eric, his son, is active in the Southwest Kansas Royalty Owners Assn. www.swkroa.com/

This fall I joined East Kansas Royalty Owners Assn. but I haven't had any newsletters from them yet.