Hello all! I’ve got mineral interest in a couple of sections that have no recent history of production…not in my lifetime, anyway. But very recently there were 3 permits issued for a HZ drill that starts at the north end of one of my sections and terminates at the south end of another…so, the 3 lines will cross 2 complete sections. This is the first time I’ll received any interest from a HZ well, so I have no idea what to expect with regard to volume of production. Can anyone give me even a wild guess about how this might go? Thanks for any insights that anyone can give.
What area are the wells at? That would be a good start. I.E. Permian basin? Eagle Ford? Second, is there any wells holding acres or still in production that might be keeping an old lease current? If not and they are fixing to drill or have permits you should contact the operator who is fixing to drill and work on a oil lease.
Hey Dan, and thanks for your reply. The sections in which I hold interest are in the Permian Basin, in Glasscock County. I’m not a surface owner, only have mineral interest.
There are a lot of wells all around these two sections, and a good number of them are HZ. These new permits start in a section that hasn’t been producing in years; there are 4 shut-in wells in it. But the section below it is productive now. The company that is doing the work is already producing in that second section (the southern-most section of this two section HZ spread.) They acquired the lease in the northern-most of these two sections and pretty quickly permitted for these 3 HZ lines, going across both sections. The wells in the southern-most section that are already producing are doing pretty good; they’re verticals.
I hope this helps. I realize there’s a lot of variation in wells, locations, etc., but thought that maybe someone has a notion of how much more productive a HZ is compared to a vertical, and in our case, 3 lateral lines spanning two sections, one of which has already proven to be productive.
Typically you will get most or even half of the life of a horizontal well oil in the first 3-5 years and then the well will settle in and could flow for 30 years. It could settle in at 85% less the 30 days. IP. (initial production). There is also a good chance they could spud more wells, refrac or perforate different targets, target different play zones. Typical EUR (ultimate oil recovery) can be 1-3 MMboe in the Permian basin. It is fairly new and if you do a lot of research it can hard to find much history on horizontal wells that have been fractured especially that have such long laterals. Even though the process of both have been around along time. Do you currently know the operator? Received any royalties on the existing wells?
The wells that are already producing are doing pretty good; they’re verticals. The operator is Parsley Energy.
What does 1-3 MMboe mean?
Million Barrels of Oil. MMboe=million Mboe- Thousand