Penn Virginia conference call today. They had issues with the 2 rigs on the chickenhawk & jake Berger units...because of the mechanical failures the 4 wells on each, 8 total only came in at between 400-1200 boepd 24 hr IP each. Way less than the 1500-2500 boepd they thought each one would come in at. Because of this they got rid of those 2 old rigs and got 3 new ones. this will increase the amount of wells drilled in 2018.
Also the Capstick and Shadduck units that were permitted by Devon look to be in trouble. Delago went and leased over half the acreage in each unit site...and with Penn is not willing to pay a lot for those leases from Delago ( Penn was only paying $550-650/acre, when Delago was at $1000) ...could be the tracts that took the $1000 could be shutout of a unit...and possibly orphaned.
Only 300 acres of land was leased from July-September. However since October 1st about 800 has been leased with another 800 in talks. Penn also decided to renew most of its option coming up in 2018 on about 1000 acres it originally leased in 2015. Penn's drilling plan now includes a goal to HBP at close as 100% of its leases as it can get by the end of 2018.
Their conference call is today, so I will see how this matches up with what I have learned over the past several weeks.
I just got some data on a new company in the area, Tight Rock Co LLC. In November they filed 61 leases in Fayette County (don't know about Lavaca) mainly in the JC Duff, Levi Bostick, WD Lacy, and M Muldoon surveys. This is mainly between 1295 on the west and a N-S line through Engle on the east.
I tried to get some information on Tight Rock and was generally unsuccessful. There are three similar entities registered; one in Dallas, one in San Antonio, and one in Austin (of all places). They may have been operating in PA in the past, but am unsure.
Does anyone have more information on Tight Rock Co LLC?
Tri-C Resources, of Houston, is making overtures to mineral holders in Engle area down to the county line. Does anyone have experience with this company?
Tri-C has lots of leases waiting for them to be picked up and paid out at lawyers office since the summer....and the last I heard about this was 3 weeks ago...in case Tr-C did start payouts in December.... Looks like this "Tight Rock" company beat them to it, since they are looking at the same area. First I was wondering if there was a connection between these 2 companies and could not find one. You can find more info on Tri-C at their website.
For what it's worth, the address Tight Rock Company LLC listed in those recent leases (10100 Reunion Place, Suite 625, San Antonio 78216) is the office for EXOR Energy and also Aterra Energy and Texatron Petroleum. James H. Fallon, here in Texas, and David G. Sepiashvili in New York names show up related to all four companies.
Back in June there were posts here about EXOR making offers and possibly sharing offices with Omimex, and ML pointed out their website www.exorenergy.com. The only other places I've seen those companies mentioned was in Gonzales Co. where Tight Rock was involved in several 2016 assignments and around the same time EXOR/Aterra were offering to sell 1,200 and 800 net acre positions there.
I got paid for a lease from Tri-C about 3 weeks ago on acreage about 3 miles SE of Shiner. They are leasing 900+ acres just east and northeast of my leased acreage.
Leases I was referring to were offers made on tracts by the Lavaca/Fayette county line in the exact surveys in WI's post. However your information about the leases being paid out SE of Shiner might answer what happened to Tri-C in our northern part of the county....they just decided to lease elsewhere because they could not find enough continuous acreage.
I think companies committed entirely too much capital to a leasing program in the Eastern Fayette area to not drill a well. They won't let that much acreage expire after leasing a ton.
I think you are correct....Geosouthern being the main operator to lease will probably be able to drill out most of their leased acreage. With chalk wells running 1000-1200 acres per unit...and if they can do the quads (4 units per pad). this can go pretty quick.
Although still wondering what EOG will do with their leased parcels in Fayette and Lavaca. They too have a lot of acreage in the "new" chalk area. I am hoping they will step up, and start drilling soon.
I've been doing some research into some of the older leases in the area in this second round of interest (in other words, not Sanchez or Cypress). Some mention was made here a couple of years ago about WSH Land and how they had leased land just north and west of SBG, generally just outside the city limits.
I went back and looked and they filed a little over 200 leases beginning 01/30/15 and ending about 02/05/16. Then on 03/23/17 they assigned an overriding interest to Petro-Hunt LLC and finally on 03/29/17 they assigned what looks to be all of their leases to GeoSouthern.
So as we've always said on here, talk is cheap but assuming that these are all 3/2 year leases, then many of those primary terms will be expiring a few months. So we'll get to see one way or the other the opinion of the area depending on whether those lease options are exercised or not.
I hate to throw out profound (?) statements without attributing them because they sure don't come from me. After The Beach Boys had already become a thing of the past, they put out the song, Take A Load Off Your Feet in which they wrote, 'Better take care of your life 'cause nobody else will.' This has always stuck with me; particularly when it comes to 'bidness' in general and oil leases in particular. All that fine print is not there for the land owner's benefit.
Having said all that, natural gas production is not the same as oil. I was told by someone who really knows this stuff that many mineral owners really push for royalty payments as the gas comes out of the ground with no processing fees and that's really not helpful for them. Many times, especially when NGLs are involved, that price is actually lower than if the mineral owner pays their share of the processing and transportation costs and gets the higher price for the processed gas.
So the bottom line is that it's much better to spend a little on legal fees up front to get all of that fine print analyzed and get advice about it before you sign on the bottom line because it's easy to get legally ripped off.
Happy New Year to all. I see that just now WTI is at $63.33 and even Natural Gas is up 1.7% to $2.97. I can't speak for anyone else here, but last fall I was just about to put in my order for an Escalade, but lucky I didn't because I've seen zero. point. zero. activity around our area of interest. No leasing, no real activity, no FSNN reports, no nothin'. The last permit filed for Fayette County was 10/19 and even though there are more for Lavaca, they are far from our area of interest.
The only 'news' I can report is that the Omimex Petroleum sign is gone from the building on Main Street in SBG and in its place is Acaval Land Co. In addition, the 'Lease Your Land' banner is gone from the side of the building. On the positive side, it appeared that their office was open with people inside.
Has anyone heard anything? News? FSNN reports? Seems like with the start of the new year things should be happening, but by now all decision makers should be back from the holidays.
Like you, I look up new permits in Fayette and Lavaca on a daily basis, whole lot of nothing.
As for Omimex, I know Acaval was their broker, so they are essentially one in the same. I don't think there's any open acreage in our area for the most part. I have seen some lease maps and it is all pretty much leased up, which is why I think someone will drill a well eventually. Too much capital spent on a leasing program to let it all expire.
Only thing I have heard development wise is, everyone is all hot about wells in Washington county, so Fayette "trend" area has cooled off for now.
What I have heard and experienced is the activity in NW Lavaca county. Modern Energy leased 1300 acres by the Komensky Feed Mill for their upcoming chalk well. Tight oil leased many acres from Praha to Engle. Tri-C is leasing from Praha down to county line along FM 1295. Penn leased up about 800 acres county line along FM 1295 to the south about 1 mile. Penn who recently bought Devon now bought Hunt oil operations in Lavaca and Gonzales counties. Penn's drilling results are now better on the east side of 95. They had a 4 well pad come in averaging about 1000 boepd for each well on the west side of 95 or the "pressure boundary", and had a 2 well pad come in at 2700 boepd for each of those wells. The conclusion was the east side is better than the west side for lower EF wells using slickwater fracking....will be interesting to see how far east this goes.
As far as northeast Lavaca, yes this is almost all leased up...at least any continuous acreage is. When will EOG/Jeter drill ? The oil that Penn is getting in the EF is now being sold at LLS prices (Louisiana light sweet) which gets a little more than 10% premium over WTI....so this is around $70/bl today. Wonder if the chalk wells are getting this type of oil as well ?
On the lease maps looks like the major area not all leased up is south of FM 532, west of FM 957, and east of FM 1295 in Lavaca county...and this trends south to a little past Bresalau and Whitting.
I still could not find the answer if Geosouthern can drill in Lavaca yet. With oil prices where they are, surprised not much activity in NE Lavaca.
I also know of and recently spoke to an independent oil operator who does vertical wells, and he said he is having about zero luck in finding any investors to work with him on his projects. He has several projects lined up, utilizing purchased seismic results, and just no takers.