Pawnee County Drilling Section 31 Township 22 Range 5E

My husband and I received notification from Tahoe Land Services that Mount Dora Energy would like to drill on our property. The White well is 1/4 mile north of our acreage and the operators informed us they will be drilling three or four more wells near here. We own the mineral rights for our property and the contract we received from Mt Dora states a $2.000 compensations for surface damages. Is this a reasonable amount? To our knowledge the well will be a small vertical well and not a horizontal well. Can anyone inform me how well the vertical wells are producing in Pawnee County or what is an average production rate for a vertical well?

I have a lease with Mount Dora and recently received a letter from Reagan Smith Energy Solutions that is representing Mt. Dora. The letter states that section 31-22N-5E is being communitized.

I am not sure on the communitized issue. Do you own the mineral rights on your land? Part of Section 31 is located within the city of Pawnee. It may be that they will be drilling in a reservoir that is located under the city of Pawnee.

Yes I own mineral rights and only 7% of the property. The property is Native owned, I inherited after father died.

Mt. Dora sent a letter 4/23/14 informing me that section 31-22N-5E will be pooled. The earlier comment indicated a vertical well. Are not horizontal wells indicated when a section is pooled?

Thanks Lera, anything new happening? I’m in California, a bit out of touch.

Pooling is needed when the minerals and/or working interest aren't held by the same person/company for the statutory spacing unit, irregardless of whether it's going to be a vertical or horizontal well. I suspect IF they are planning on drilling under the City, it will be horizontal but, the fact that it is pooled does not determine the well type.

No one likes to talk about what is reasonable for location damages. $5k for a vertical location and $10k for a horizontal location are being paid in many areas of Pawnee County. Many times more & most times less. The lesser number comes from us mineral owners not talking about what we are offered & it not being published anywhere. Oil companies have big costs and saving on surface damages seems to be an easy way for them to save a relatively small amount of money, compared to the total cost of the well.

Can a vertical well be unitized in a 320 acre spacing unit when the well is located in the extreme northwest corner of the unit? There are 3 other vertical wells located within a 1/4 mile of our existing well and all three of them are in different spacing units. Is this usual practice within the oil and gas industry on vertical wells?

Yes is can. It can be done as concurrent spacing or it can even supersede the existing spacings for wells within the 320 ac spacing unit. If the operator of the vertical wells does not protest the spacing or @ least the well location, it could either damage the existing vertical well, improve it for a time or even have no effect.

The spacing was done by the same oil company producer. Seems like to royalty owners they would space the four vertical wells in the same spacing unit since they are clustered together instead of all four being in different spacing units and located in the corner of each.

Possibly producing from different formations? Maybe one or more are increased density locations? Could also have been established at very differing times when more or less was known about the drainage capabilities of the producers?