Marian, you asked for information from anyone having experience with the production of a horizontal well in Reeves County… 2013 was the first full year of production of the Jane M. Graves Unit 1 #1h. Production started in August 2012 and except for the first two royalty checks, which were higher, the royalties have been fairly consistent. My wife has 20 mineral acres of the 640 mineral acres used for the well in sec 1, Blk 7, on the Pecos River, SE of Pecos. This is an old lease going back to 2000 and continuous since 2008, so the royalty interest is only 20% for a royalty decimal interest of 0.00625313. In 2013 the total income was $19,715 for an average monthly income of $1,643. The high was $2203 and the low was $893. We won’t get rich off of the well, but the monthly incomes definitely helps. The net gross on the well runs between $150,000 to $200,000 a month. Hope this info on a horizontal located out of the “sweet zone” of the Delaware Basin helps answer some of your questions. Donny
P.S. The well was drilled to 11750 feet to the Phantom (Wolfcamp). The well was started in the S/2 of the E/2 and went north toward the River. Donny
Donny - whose the operator. Thanks for posting. Later – Buzz
Buzz, the operator of the Graves well is Endeavor Energy Resources L. P., located in Midland, TX.
Donny – thanks for the quick follow-up. Later – Buzz
For “shut-in” royalty see http://www.mineralrightsforum.com/forum/topics/what-is-a-shutin-pro…
Can someone explain what is a shut-in royalty, and when is in effect
Thanks Donnie…that does give me a snap shot of what it might look like when a well is completed and producing. Thanks for your time.
In 2014, we were paid $400 per net mineral acre on an extension in section18, block 3 Reeves County, they now want to re-lease @ $1,500 per net mineral acre on the same section, it sounds great but oil companies have not been known to be fair all the time. What would be a fair dollar amount or is @1,500 hundred more than fair
Roy, I would think that $2500-$3000 would be closer. If you don’t ask, you don’t get!
Energen - compliments the post below… with maps:
https://topeka.bluematrix.com/sellside/EmailDocViewer?encrypt=24a6e…
Later – Buzz
thanks for the link Buzz. page 4 of the slides shows our Tisdale 56-8 #1H. just got the Division Order mailed off two days ago.
Congrats Wade!
Dumb question I have 15 mineral acres and my sister in law has another 15, we had leasted for last 5 years and now 3 year until Nov 2014. My question is the gas will on the lease (A-1411 sect 17 block 20 has a gas well on the public viewer ( #01128) but we have never heard anything. I guess I do not understand what is really going on.
Ronnie - I see the gas well symbol on . Operator Monarch Corp. received a 7-10-78 permit to re-enter the SHURTLEFF (TOYAH UNIT) #1, API 389-01128. I’ve seen indications in 2 places where it may have become an injection well. Also, on the same section there is another old permit granted 8-30-84 to TXO Production Corp. for the TOYAH ‘E’ #1, API 389-31536.
In your immediate area, BHP/Petrohawk has drilled wells in the last 18 months. Who are you currently leased with? Later – Buzz
Buzz Keystone leased Nov 2011
Like the LG commercial says Life’s Good. My wife and i got back earlier this week from a Valentines cruise for our anniversary. Waiting for us was a division order. Its been along time coming the well was spudded last March
Garland
Does anybody here have any insight to my situation? I noticed today that our well 389-33564 showed up in the completions report for oil. In September of last year they filed a completion report for gas. I noticed that the 24 hr flow rate for oil had 2 bbls and 54 bbls of water. We have 160 acres under lease for this well. BHP, in November sent us a offer for the other 160 acres then decided they did to rescind the offer. Our atty contacted the landman and he implied they’re not happy with the initial production and were still running tests. The permit that is on file says it is a horizontal well. Our atty told us that is actually a vertical well that they are doing a 7 stage frac.
My question is, if it is a vertical well, dont they have to change the permit? And if the well is not producing what they want it to, how much oil or gas would the well need to produce for them to put it online? Thanks
George, there are other folks on this site that I sure can tell you more but based on what I’ve seen BHP always starts out by filing a G-1, which is a gas well completion report, on any well they don’t plug immediately. Those initial reports never shows any potential test or completion informationj but apparently are able to satisfy RRC’s minimum reporting requirements. In this case it looks like BHP finally got around to filing a real completion report (as a W-2) on 2/20/14 but according to what’s shown on the 2nd page in section 46 the 2 barrels of oil was with only a 1 foot producing interval being completed (11349’ to 11350’).
According to this report and also the directional survey they filed this is a vertical well, which doesn’t fit with their permit or with what your attorney heard about a 7 stage frac…Hopefully somebody will correct me if I’m wrong but I don’t think you can do a staged frac unless the well has a horizontal leg to frac, or they are completing it in multiple formations. Maybe what they are telling your attorney is that they haven’t finished completing the well and may still be planning to drill the horizontal leg. I’d be hesitant to sign anything new with BHP or anyone else on your other 160 acres until it becomes clearer what the potential is of this existing well. If you are outside the primary term on the lease you have with them there is a limit how long BHP can sit on this well before they either have to produce the vertical they have now, add a lateral to it or plug it and release your acreage.