Ron my minerals are 31-18N-3E in Payne county.today I received an offer for 3500.00 or will better any other offer that might be on the table . This is from a company in Dallas called Fairmont. I still have the letter with the 3 choices of option. It has leaves as voices but no real lease. It doesn’t say it is a pool.
Payne: B & W Operating LLC; B & W Greenshields Trust No. 1-23H Well; SE/4 SW/4 SW/4 SW/4 (SL) of 23-19N-01W; 1,303 barrels oil per day, 1,215,000 cu-ft gas per day; TD 9,398. Is there any reason why this well tested so much better than others in Payne County, or is it just luck?
Steve, “Big quake in Kansas? Seismologist Don Steeples, a professor at the University of Kansas, said the state has the potential for a 6.0 to 6.5 quake. That’s based on the length of the active fault lines in the state, he said. The longer the line, the greater potential for more energy to drive the quake. Kansas has segments of the Humboldt Fault Zone that are 40 to 50 miles long, Steeples said. In California, the San Andreas Fault extends more than 600 miles. The Humboldt runs from near Omaha to Oklahoma City and passes near Wamego and El Dorado.” Note: The Humboldt fault in KS is known as the Nemaha fault in OK. Payne Co is just east of the Nemaha. http://www.kansas.com/news/article1139320.html
I hate to mention the F-word (fracking) but the Tulsa World had an article about meetings at the Captiol this month & next regarding water usage by fracking (not water pollution) and seismic activity from fracking. It has been banned in parts of the Northeast…I’ve read several articles pro & con but wondered if any of the experts in the forum have worries?. Thanks
Those are some pretty serious scientific findings, it’ll be interesting to see how pro-petroleum states like Tx & Ok react. I saw a story on the news that some company has come up with a portable giant rubber/plastic “pool” to dump waste water in - I didn’t see what they will do w/ the waste water when they empty the pool but at least someone is working on an alternative to injecting it. Thanks for the research/info
I received a lease offer on rights in 34-19N-2E: $350/acre bonus with 3/16 royalty. I haven’t seen any other activity in that immediate area so I’m not sure what’s reasonable. I plan to at least counter with $0 bonus and 1/4 royalty. Is that reasonable or should we try to hold out for a bonus and the 1/4?
Quentin, Mineral owners in Payne are getting $250 (or higher) cash bonus and 1/4th royalty for a 3 yr lease with no option to renew the lease. I start high with my counters, because it’s easier to go down than up.
G Win . You could do that or you could wait for the pooling and make an election under the pooling . Or you could lease to third party . If you sign a lease there are some things you will need to watch for in the lease.
I’ve read a lot of scary comments on early well production declines, so did some research and found that production does go down, but it goes back up and remains constant and here’s why…
“The practical capacity of a gas well need have no relation to its open flow capacity. However, it is commonly assumed that for efficient and economic production a well should not be allowed to deliver more than 25 per cent of its open flow capacity and in some states this rate is regulated to 20 per cent. This applies to wells of large deliveries and in their earlier stages of the well’s production. It is easily seen that a well may decline to the point where it is safe and economical to produce at full open flow capacity, and in later stages the gas may be produced under vacuum. This is particularly true where gas is rich in natural gasoline hydrocarbons.”
Natural gasoline hydrocarbons are Natural Gas Liquids (NGLs) like Payne Co wells produce. Chart shows we need to wait more than 40 months into well production to determine when open flow will occur. Looks like well production starts at month 0, then falls off 20 -30 months, goes back up 35-40, comes back down 45-50, and finally goes back up and remains constant to it’s beginning month 0 to 10 months production.
Now, if we can just trust the beginning months production rates. Never knew a company, not even the most honest ones, that truly wanted mineral owners to know absolutely everything they needed to know.
Yes, Rob it does apply to light oil, but Payne has a light production known as ‘condensate’ and gas that is known as ‘wet gas’ which is the natural liquid gas (NGL’s). And yes the NGL’s bring a higher price, but they have to be processed in a natural gas processing plant and sold after processing to bring a higher price. Most people are used to raw crude light oil and dry methane gas. Liquid condensate and NGL’s are a whole new ballgame.
There are gas processing plants in Cresent and Calumet. The one in Cresent is now owned by Regency Energy and their current unit price is
**32.23 (1.33%). ** However, Payne county east of the Nemaha fault zone forms a discharge ‘locus’ where pressure reaches near atmospheric and that means the condensate comes out of the ground as a liquid and not as a gas that has to be processed. I have heard from reliable sources that they are stripping the condensate out at the wells (no processing) and sending it to market, but paying mineral owners as if they had to process it at the one of the plants listed above. That means minerals owners are getting around $32.23 for the liquid condensate, but they should be getting a price of around $100.00. Today, I informed the so called head legal lady of the Oil and Gas Conservation Division of the Oklahoma Corporation Commission (OCC) of all the above and she said “they didn’t regulate stuff like that”. I asked her where I could find OK statutory law defining “stuff like that” and she said that OK had no definition for condensate. She informed me I would have to discuss it with Devon or the other operators or “take it to district”. She obviously had a way with words, but I think she meant court.
I’m wondering about evaluating inherited min interests when they’re sold I assume they’re capital gains but the ones I own were not mentioned specifically in a will and never paid royalties so have had no established value. I know the answer I’ll get is see a tax lawyer but I thought maybe someone else has run into this and could save me a fee. Thanks