New Member Introduction

Hello everyone. I’m new here and want to introduce myself.

My grandfather was a homesteader in the SE/4 of Section 12 Township 13N Range 6W in Canadian Co. My grandmother received some income from a lease back in the 80s but those have been plugged and abandoned. I note that about ten Hill-Hodges wells remain active on that section.

Lately we were approached to sell the mineral rights, a good indication that someone somewhere knows something I don’t. I’d like to know what they do. I’d also like to know the fair market value.

If anyone can update me on activity in that part of the county I’d be grateful. It looks pretty quiet from what I can tell.

Also, a few questions:

//. Are wells being reopened with enhanced production methods?

//. It is tempting to hire a petroleum geologist to evaluate the potential and value of our mineral rights. Would that be premature? Are there better ways?

//. Finally, we have not yet probated these mineral rights in Canadian County and an affidavit of Proof of Death and Heirship won’t suffice in this instance. Can someone recommend an attorney that does probate at a fair price?



DC, there is quite a bit of activity moving into 13N 6W, mostly on the west side right now. However, some leasing in 12 in 2013. Newfield is moving into the township with horizontal drilling in their Meremac play. I would encourage you to read the last couple of Newfield presentations. Here is just one of them.

1-yes wells can be opened and reworked. More importantly, the area is being drilled horizontally with new wells in the near future.

2-you could hire a petroleum geologist or petroleum engineer to evaluate your potential, but personally, I think it is a little premature. Since this horizontal play is just now developing, companies are just beginning to exploit the horizons in new ways. If you are not in a hurry to sell, waiting could be good. If you are in a hurry, then that is a different ball game.

3-now would be a good time to get your probate done. I don't live in OK, so don't have a good name. Maybe someone else could help with that.

4-read up on the last few months on this forum to get caught up if you are new. I would then suggest that you go read the last six months or so on Stephens, Grady and Garvin to get up to speed on the whole horizontal play known as the SCOOP. Then go read the Newfield, Cimarex, Devon and Continental Resources investor presentations for the last year. Especially, Newfield, Devon and Cimarex for Candadian county. This is know as the CANA-Woodford area (also a forum group by that name).

5-Most of us with mineral rights in this area would not sell at this time unless you really need to. The potential for the Meremac play is just starting to become known. If you have an offer to buy, then it is indicative of pending activity and is usually low to the real value. Get informed before you make any decisions.

Also type in "value of mineral acres" or something like that in the SEARCH area and see what other comments have been made on the forum about general values. Welcome to the group!

Thanks for that information. It’s very helpful. A reading list was exactly what I was looking for. I’m not in a particular hurry to sell and am inclined to wait and see what develops. As you note, the first out of the blue offer would just about have to be on the low side.

I do have a question about horizontal drilling, which I’m sure is explained in the reading list. But, I’m curious about the potential of revenue from the horizontal drilling on the west half of the selection. Does the extent of the horizontal drilling allow an operator to drill far enough laterally to produce from a neighboring lease? I assume the law is up to speed on the practice and has “Rule of Capture” protections in place for neighboring mineral owners. How does that work? Is the direction and range of a completed well a part of the public record?

Thanks again for your remarks.


Yes, the Rule of Capture is handled by the spacing designations and the well paths are quite controlled. A well is positioned as to not "steal" from a neighboring lease. The rules are in place. Depending upon the reservoir's depth, oil or gas, vertical or horizontal, etc, spacing and placement of wells is determined the the OCC.

Yes, the completed well paths are a matter of public record, but it takes about six or so months to see it. The planned path is also a matter of public record. You can see it in the permit filings on the OCC website. Are you familiar with it? There are free ways to see the wells and there are subscription sites that also have the well paths. I use both.

Do you have a particular question about horizontal wells? I am a geologist, so may be able to answer it. If you want to go offline, then friend me on the website and we can chat.

OK, i read up on the spacing and that all makes good sense. The drilling for dummy’s version is that one can expect just one well per section and the section owners are typically pooled.

I should do some more reading before I start asking a bunch of silly questions about horizontal drilling.

Having said that, and from what I’ve read in the past, the well is typically drilled straight down to the desired depth, then turn 90 degrees and then drilled horizontally without significant change in depth during the horizontal run. Is that generally correct? If so, I would like to know what is the practical limit to how far latterly one can drill. Or perhaps it’s a legal limit rather than physical given the legal issues surrounding the pooling of leases by section. By that I mean the operator may only be looking for oil under the section for which he holds leases. How close am I to understanding this?



You are getting there!

In OK, each section can be spaced up to 640 acres. It is called a multi-unit well if the horizontal goes across two sections. The longest I have heard to date is across three sections (about half of the third), so we will see if they actually get it drilled that long. They like the toe (end) of the well to be slightly higher than the heel (where the lateral starts after the turn), but it doesn't have to be.

I attached a sketch of a well so you can visualize.

Now, here is the most important part about the horizontals from a financial point of view for the mineral owner:

The first well is spaced at 640 acres. (Two sets of 640) if across two sections (for OK). The operator drills the first well to hold the acreage. They see how it drains the acreage and then they can go back and petition for additional wells in the section and line them up like cigars. I am getting production from nine parallel wells in one of my sections. I was a very surprised and happy camper last year! So the decision you make for bonus and royalty is very important. I try to choose the lowest bonus and the highest royalty because I only get the bonus once and I get that royalty for 30 years-maybe on many wells. I also attached a spreadsheet that a couple of us developed where you can input your acreage and your offered bonus and royalty rates. (I need to change the tax rate to 2%, but that just happened last week, not sure when it goes into play.) It shows what typical Woodford well might pay out, two, four, nine. You can get a feel for a given scenario. I use this sheet to help me make my decisions based upon the net acres, typical production in an area, etc.

Let me know if you have any more questions.


1803-horizontalwell.png (323 KB) 1804-NMACalculationsimplemodifiedfor3bonus.xls (50 KB)

Hello DC,

I am new to this group as well. We also have mineral rights located in the same SE/4 of Section 12 Township 13N Range 6W. We have been contacted several times about leasing options. Once they found out we only own 1/32 of the 160 acres the haven't been interested any longer.

We received a forced pooling letter from an attorney. It arrived 5 days after the date of the pooling. I am wondering if we are too late to sign a lease agreement.

Let me know what else you have found out.


Michele Doss

You only have 20 calendar days from the date of the order (last page) in which to reply to the pooling order. You can lease with someone else within that time frame but you have to move fast and consider that you only have about 15 days because they have to get your lease filed in the county courthouse before the pooling time closes. Be sure you send anything to anyone by certified return receipt mailing so you have a paper trail. If I do a late lease like that I usually also respond to the pooling letter that I have leased with so&so for $xx bonus and xx royalty and if the lease is not filed in time then I select option xx for #xx bonus and xx royalty just in case. You do not want to end up with the 1/8th option.