Looks like they are running the water lines to frac, but they have 2 gates now before you get to the well. Too cold to walk through the pasture to check. Quite sure that they are not fracing yet.
Diane,
They have finished drilling, and they have moved the equipment off the pad. They will probably start fracing in a couple of weeks and they are laying the water lines to frac. Rumor is they only got around 26,000, they didn’t get as far as they were planning.
Comment: Just because oil is down to $80.00 a barrel, Grandma would be happy with that.
Bearcat wants to lease my 1/2 acre in Section 21 for 750 3/16 royalty for three years. Should I? They did not mention bonus depth clause or any other clauses…
SJK: Section 21 of what Township? I would probably wait. I personally would go for a higher royalty and not bonus. 1/4 royalty is the highest I have heard of being paid, usually without a bonus, but bonuses have been showing up lately. Remember the bonus is just one time, and there are usually 6-10 wells per Section ultimately.
In general, BearCat and most other “standard” (NOT) leases need lots of negotiation. You definitely need a depth clause, shut-in royalty limits, do not warrant title, no deductions, etc.
If $750 is the first offer, it will most likely go up. The usually start much lower than they will end up with just to see who will take it. Which township and range?
Martha, did you hear that on Oceana Section 8 Township 1 North Range 5 West (a part of the horizontal well spud on Section 17 Township 1 North Range 5 West) they ran into some type of heavy resistance and therefore made the “hole” stop before the intended length? Do you happen to have any current geological information on this area?
I am not surprised. The well was drilled perpendicular to the Cruce Anticline which has been quite prolific over the years due to the structure of the sandstones which were sourced by the Woodford underneath them. A big thrust fault called the Fox Thrust sets up the core of the anticline. If you want to see a picture of it, look up the PhD Thesis by Saxon, 1998 out of OU. See the Figure 7.11 on p. 174. Here is my link. Not sure it will work, but you can try. If you look at section F, the Ocean was drilled essentially like the Texaco Cruce #1 well and then turned to the right and went horizontal at about 15,000’. Probably ran into complications due to the fault or ran into the hard Cambrian. This sketch is only a guess at to what it looks like down there. Go to P. 47 for a map of where the cross section cuts.
Section G is useful to you folks in 2N-5W. In fact, this whole paper is quite helpful for the Southern SCOOP area. Go for the pictures if you don’t want to bother with the geology.
SJK-Bearcat is probably leasing for Continental Resources in that section. The section just to the south of you (28) had an offer of $1000 and 3/16 a while back.
Virginia, ask if they are leasing for Continental. That is who is probably going to drill. They are giving 1/4, but don’t know if for 0 or more . Make sure you get the clauses you need, or wait for Force pooling.
“My expectation is that Continental’s investors will rue this decision because it changes the firm’s business,” he said. “Hedging provides an assured cash flow. By dropping the hedges the firm is gambling that prices go up. If they go down, Continental will go bust.”
Thanks for the input, just got off the phone with Chrystal at Calumet. Continental is the driller and they are a participator. She is checking to see if they can match what Freedom has offered at 3200 an acre, but I worry about Freedom since I can’t find any record on them. Will post the outcome when I find out. But it is more than what Continental offered before they sent out the pooling notice. Calumet did offer a 1/4th and 500 bonus.