I have 3.35 net mineral acres with 100% mineral rights in a 80.5 acre pooled. There are three wells on the property (not sure if they are producing yet) with at least one of them an oil well. All wells will be horizontal (fracking) . They may all me combo wells I'm just not sure. Anyway I've been looking at production in existing wells in Montague county. Can I be fairly safe in assuming the 3 wells on my property will produce about the same oil and natural gas and liquid products as existing wells in the same county? If so what would be my monthly revenue check. I have no division order yet, but plan on calling soon. Thanks
oh i forgot to say i have 25% royalties. if all three well produced a total of 500 barrels of oil a day and 2,000 mcf what would my monthly royalty payment be. Thanks again.
There are royalty calculators out there but you have to know your decimal interest first - google royalty calculators. BUT don't get too excited if you do projections because some non-participating royalty interest heirs might crop up and greatly reduce how much of the minerals you really own - this will be determined when the division orders are done - even if those heirs can't ever be found, their royalty interest will be held by the state in trust (or something like that) and after 10 years, it all goes to the state. This happened to us in Montague county. Also, don't count on the wells producing 500 bbl every day or 2000mcf of gas every day - as the oil/gas companies control that production - they want the wells to last 20-30 years. In the beginning they might run the wells hard to see what output potential is, (possibly to recover expenses - it costs about $3million to drill a well - and to repay their investors, etc.) and then the wells will probably be choked back to control the production. Also - when a nearby well (not on your property) is brought in - your well will probably be shut-in - and, accidents can happen with fracking the near-by well - your well can be damaged and it's like starting all over again - the well might be saved, maybe not - been there, done that - just educate your self to the greatest extend possible and whatever you do - DON'T COUNT ON ANYTHING AND DON'T SPEND MONEY YOU DON'T HAVE AND DON'T EXPECT ANY EITHER - that way you won't get disappointed and you won't get yourself into trouble. I've been looking at the RRC production reports for specific leases for quite sometime and I just don't see (if the reports are right) any frog-strangling productions - the only thing that matters after a well is producing is your decimal interest.
3.35/80 x 25% x 500 Bopd x 30 x $90/bbl = estimated $14,132/month
3.35/80 x 25% x 2000 Mcfd x 30 x $4/Mcf = estimated $2,512/month ... but, as cautioned, don't count it until you get it?
Susan Nolen said:
There are royalty calculators out there but you have to know your decimal interest first - google royalty calculators. BUT don't get too excited if you do projections because some non-participating royalty interest heirs might crop up and greatly reduce how much of the minerals you really own - this will be determined when the division orders are done - even if those heirs can't ever be found, their royalty interest will be held by the state in trust (or something like that) and after 10 years, it all goes to the state. This happened to us in Montague county. Also, don't count on the wells producing 500 bbl every day or 2000mcf of gas every day - as the oil/gas companies control that production - they want the wells to last 20-30 years. In the beginning they might run the wells hard to see what output potential is, (possibly to recover expenses - it costs about $3million to drill a well - and to repay their investors, etc.) and then the wells will probably be choked back to control the production. Also - when a nearby well (not on your property) is brought in - your well will probably be shut-in - and, accidents can happen with fracking the near-by well - your well can be damaged and it's like starting all over again - the well might be saved, maybe not - been there, done that - just educate your self to the greatest extend possible and whatever you do - DON'T COUNT ON ANYTHING AND DON'T SPEND MONEY YOU DON'T HAVE AND DON'T EXPECT ANY EITHER - that way you won't get disappointed and you won't get yourself into trouble. I've been looking at the RRC production reports for specific leases for quite sometime and I just don't see (if the reports are right) any frog-strangling productions - the only thing that matters after a well is producing is your decimal interest.
Do you think a well within 290 feet of the property line poses a problem of the well being shut-in ?