Horizontal spacing of wells

I just received a letter from Continental requesting approval for spacing of a well in the Sycamore Formation. “50% of the ownership having a right to drill in each Sycamore well, etc”. I’ve not seen anything like this before…what am I approving and what are the consequences? Can anyone explain this letter for me? Thank you.

Was it a letter or was it a form from the OCC? If it was a form, what is the case number?

The request came to me in a letter. There is no form or case number. It states, in part, " In preparation for the drilling of a well, Continental plans to file a 640 acre horizontal spacing application with the OCC for the Sycamore Formation in Section 33-1N-3W, Garvin County, OK. Occ Rules require that at least fifty percent of the ownership having a right to drill in each Sycamore well and drilling and spacing unit consents in writing to the formation of the proposed horizontal well unit. Continental hereby requests your approval of the proposed horizontal Sycamore spacing". The letter came with a consent form.

Interesting. I have not received one of those yet. Are you a working interest owner?

Continental already filed for the horizontal well. I see your family listed on the respondents list.

If it were me, I would probably sign “yes” as the production from a horizontal well in they Sycamore could be beneficial. Yosemite Sam was already drilled in section 31 and 6 in the Sycamore. Billy the Kid is permitted in sections 29&20. Caney Sycamore and Woodford. It started drilling in August. The play is moving your way.

The majority of this section is HBP by unitized sycamore & has some BIA acreage. Both of these require a certain percentage of mineral owners to agree to changes in existing spacing. You should agree to it or you won’t get any additional wells.

Sorry, I forgot to mention that I am not a working interest owner.

Thank you for the information and advice. I’m afraid that I am not familiar with the terms HBP and BIA, or what Continental has been up to in the section, leaving me in the dark on just what I’m signing. This letter is the first contact that I’ve had with Continental concerning anything about Garvin County, including leasing, drilling, location, etc…it’s really just out of the blue. I will go ahead and return the consent letter. One thing that it asks for is my ownership as a % of the whole, which is difficult for me to answer, because I’m not sure what the “whole” is. I do have small royalty holdings in Garvin County, but the royalties have come from another company in the past. I appreciate all the information from the forums. I live in Minnesota, making it a bit difficult to keep up with things.

HBP means held by production. BIA means Bureau of Indian Affairs.
If Continental sent you the letter, then they think you own acreage and they probably know what it is. Send in the letter by certified mail, return receipt and keep a copy. After that is done, contact Continental and ask them how many net acres they are carrying for you and at what royalty.

Ok, now that makes sense. Thank you so much!

Interesting, I received the same letter.

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