How to find monthly well production values

#1

How can one find out monthly production amount per well, not per lease and not combined as is available from RRC production query?

Location is Section 11, Block 3, H&GN Survey, Reeves.

There are three new wells for which I know what the 24 hr test values are from the recently filed W-2 forms although only one was at full choke (the others were at about 80% full choke) for the test. Wells are 42-38937041, 42-38937042 and 42-38937042. Field is 71052900, Phantom (Wolfcamp). Diamondback is operator (217012).

As a mineral owner am I entitled somehow to get the monthly productions runs? We want this info for personal planning purposes and also because monthly reports to RRC and via royalty checks are from production at least three months prior, i.e. not for the current month - correct?

Thanks.

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#2

Richard,

When you receive your royalty checks from Diamoindback (DIA, these wells used to be Energen) then they will have production info from each well in the unit. (Kath Unit) The first check typically is from roughly 3 months of production and will be significantly larger than any other check that you will receive. From that point on, DIA will send monthly checks that should be each month. Occasionally you will have some months that are reconciled later but that is rare.

Hope that helps.

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#3

Perfect, good info. Nice to know that from here on out payments will be for a current month and not a past month.

I looked back at the first check which was issued thru Energen [so it is still on the account portal with them] and now I see the production values in the stub.

First question: The second check has been received and was issued by D’back. It is approx 1/3 of the first check by value so assuming the price/bbl is the same for both checks is it safe to assume the income amount to be budgeted for each month will be based on this second check?

Looking at the W-2 Completion Report for each of the three wells combined it shows a 24hr testing avg of 50 bbl/hr whereas the check stub for the first 3 mo payment shows a production avg for the 3 wells combined to be 15 bbl/hr.

Second question is: Will the wells be produced at 15 bbl/hr even tho capability is at 50 bbl/hr?

Third question is: 1)Are we saying by this 4th mo that production is stabilized at its maximum and 2)from here on out [barring re-entry stimulation] this is the max production value, i.e. as good as it gets, and the decline curve starts from here?

Thx so kindly for everyone to read this.

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#4

My general rule is that the production volumes drop 50% over the first year and then again 50% over the second year. Decline rate slows in third year, but it is continuous. The completion report should show a 24 hour total at the test. If the choke was wide open, do not look for this volume on your checks as the choke will be smaller as the well is produced. Some companies test with wide open check to report giant volumes to Wall Street. If they left the check wide open, the well will have a very short life. Other companies test with small choke and operate the wells conservatively to prolong the life and maximize the total production over time.

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#5

Hmm, interesting. Thank you for the response; that certainly makes one rethink the strategy of whether to hold or sell, I know I shall start considering purchase offers a little more seriously.

FYI, for Energen royalty owners, Diamondback info just arrived in the mail how to join their owner portal so it appears that part of their transition is moving forward at what I would say is ‘quickly’ and efficiently.

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