Logan County, OK - Oil & Gas Discussion archives

I guess I shouldn’t say I don’t use depth clauses, but my clauses are wrote a little different. Let’s say they drilled a well on the lease and hit the Mississippian at 5,600 ft and it looks like a good producer, small company has the lease. Now my lease says they can only go another 100 feet if they stop and start producing that sand. Down the road a mile, someone does a test well and hits a really good well in the Sylvan at 6,500 ft. Now unless my company wants to pay me for another lease, they won’t go down to get another sand. So, there are some good things about a depth clause and some bad things. If the company is a big company, they will probably go ahead and pay another bonus and drill depth later on, but not at the beginning. Again, lots depends on the location, has there been lots of good test wells in the area, etc. That is one reason people need to research the area around them and know what sands are producing and what hasn’t.