A question for one of our more experienced members: It has been over a year since approval for several wells was granted for 17-3N-4W (Cause CD # 201806602). Continental has a few producing Springer wells in the same area (the Omer wells) but we haven’t heard anything about the proposed Woodford wells in over a year. How commonly does it happen that they allow an approval to expire? Does that mean they have probably given up the idea for good? Or is it just that they decided to leave it in the ground until if/when the price goes up and stays there? Would they then have to go through the entire approval process again? Thank you…
You do not normally get any info on the drilling wells until the Division Order. However, you can look up the permit, spud, surveys and completions on the OCC website. You need to look up both section 17 and sec 20 since the wells are posted by surface location. Look for the Hines wells with a 17 in the name. Test
Now go to the OK tax site and look for the Hines and the Omer wells. Gross Production. The active date is pretty close to the first sales date. The Hines wells had first sales in September 2019, so you might see Division Orders by February.
My 3 brothers & I have some nma in 20-4N-3W, Garvin. Lang 20-1H began producing in 2013, Warden in 2015, & 6 (of 10 planned) Omer wells in 2018. Does anyone know why CLR just mailed us 71 pages of accounting info for all these wells, their entire lifetime production & royalty payments? for oil & gas production, there are paragraphs of +income, and separate sections for the same time periods, of - “income”. Over the 6 year period, total lifetime of all these wells, the + total & - total are near identical. the difference is $134, for which CLR wrote us a check. What is a likely scenario/motivation for CLR to do this kind of (apparent) “accounting correction”?? Over 6 years, CLR deducted almost as much as they paid us! ??
Hi Mike – I won’t be able to answer your question, but I can say that I too have received this sort of accounting from CLR periodically (our interests are in 17, just N of you, Omer and Hines wells). I haven’t received the particular papers you are referring to, though. All I can say is that I don’t understand the purpose of those pages and pages of + and - calculations either. Hopefully someone on this forum will enlighten us! All I can say is that the royalty amounts don’t seem to be affected by their accounting… at least that is my impression.
Sometimes after the end of a sales month where there are sales by both non-operators and the operator, they have to make adjustments later for actual sales by the respective parties. Depending on the sophistication of the division order department of the operator, the adjustments can be made monthly, or they may accumulate the data and make several months on one check run. The operator’s division order analyst should give you an explanation if you can get him/her on the phone.
Thanks. I plan to call CLR tomorrow to ask questions. In this case the time period is 6 years. For 8 wells. This looks highly unusual to me.
Makes you want to say “Save the trees used to make the paper and sent me the money used to make up all the paper work!” doesn’t it?
Yes! OK, I had no problem getting someone on the phone (844 883-5257). As suspected, CLR revisited their accounting over the 6-year lifetime. of our 8 Wells in Garvin 20 4N - 3W. Lang 1-20H, Warden, & 6 producing Omer wells. Negative income entries represent royalties already paid ; positive entries are royalties recalculated. The difference was $132. 8 wells over 6 years…
Earlier there was a lot of hype pushing the proposed 10 Omer wells but in the end they didn’t amount to much…
I have a question that is related to my sister’s: If rights include all levels, in a good area such as the SCOOP, then what are the chances that one may hope for future drilling if one of those levels has proved to be less than spectacular? If Woodford horizontals have proved to be disappointing, can we dream that at some future date the other levels might be approved for drilling? Also, what does it mean when there are no completion reports at all? Thanks ahead for any responses.
Sandra: Those are very abstract questions as we don’t know what the future holds. If you will provide the legal description, we can look up activity, ie leasing &/or drilling in offset sections, to get a better idea for you.
In some parts of the SCOOP the Woodford formation is up to 400ft. thick. I have interests in 2n/4w and we have wells at different depths of the same formation. In addition the Springer formation has been successfully drilled in the area too. Depending on the timeframe lack of completion reports could mean that they have not yet been issued, the well never got drilled , it was drilled but not completed, could be a number of reasons.
Thank you for your answers, it helps. I am talking about Garvin section 17 3N 4W. Omer and Hines wells, relief horizontals spud in February 2019 I believe. Got all the paperwork signed and approved for these relief wells, then recently I got notifications that three of them are no longer needed, which rings ominous to my ears!
Companies are constantly trying to figure out how many wells are optimal in each reservoir. The overall intent is to drain the reservoir effectively, not to drill as many wells as possible. They want to deploy their capital efficiently. In the last year, the company mandate is to live within cash flow and not to borrow too much. In areas with multiple possible reservoirs, companies may choose to drill a deeper reservoir that may not have optimal economics in order to save the deep horizon by production and hold any shallower reservoirs for the future when prices get better. Other companies may choose a different path and only go for a more productive and economic shallow reservoir.
Omer 1-17H is a Springer well. Hines 1-17H is a Woodford well (deeper zone). These were the test wells. Quite a few more infill wells have been drilled since then.
You can look up the completion reports for the new Hines and Omer wells on the OCC well records site. Test Type in 2003N04W in the location box. The completion reports are 1002A. Type in 1703N04W for the wells with surface locations in 17. Looks for the wells with 17 in the name.
Thank you so much, Martha, as always!
And thank you especially for your patience in answering so many questions, which often are redundant (won’t say stupid, but you know what I mean! ;D)
No problem. We all started at zero knowledge, so don’t mind sharing what I have learned over the years. Keep asking questions!