The map below shows all the county surveys that contain leased acreage associated with the Bossier/Haynesville play being pursued by Comstock, Mitsui, and Expand(Chesapeake).
Note the lease area in Cherokee County. That leasing project began in 2020 with two-year seismic options, of which more than 90% were converted to O/G leases written by Key Exploration and East Texas Energy. Key and East Texas have recently been extending leases that have reached the end of their primary term. There has been no assignment yet, but I have believed for a long time now that Expand is the company behind the Cherokee County leasing.
Look at that big unleased gap between western Anderson County and Cherokee County. Although there is no well data to go on, there is no reason to believe that area is not prospective for this new deep gas play. I see no reason to believe that we won’t see leasing in that area in the coming months.
And now we may have a hint…
One of the Expand lease proposal sheets sent to me recently showed a name for the leasing prospect: Two Rivers. When I think of two rivers, I think of the Trinity and Neches Rivers that define the western and eastern boundaries of Anderson County. Could this prospect name mean that Expand intends to fill that gap from the Trinity to the Neches with new leases?
We will see…
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I own minerals in the Sarah Hodges Survey (A 350) which is about 10 miles NE of Palestine on the South side of Hwy 79. Do you think they will expand into this area?
Something to think about here concerning the Key Exploration and East Texas Energy leases is that they don’t have the ROFR in them, which is discussed in another subject topic and tied to Expand. With this provision not in the lease, makes me think it’s another operator.
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The Cherokee County leasing was done well before there was any competition…no reason for ROFR. Name another operator who would shell out the money for seismic work, leases, and lease extensions and sit on it for five years.
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Do we know if they ended up shooting seismic?
HILLCORP Energy is rumored to be going to start drilling the Deep Horizontal Bossier/Haynesville wells real soon in Limestone, Freestone, Leon, Andersen Counties. Hillcorp has a lot of wells and HBP acreage in Limestone-Freestone Counties that they acquired from XTO several year’s ago.
It’s unlikely that Hilcorp would be drilling Bossier/Haynesville wells as they did a deal with Comstock that I described in a March 2024 post:
"In a 282-page assignment document filed in Robertson County on March 26, Comstock has acquired the rights to the Lower Bossier/Haynesville interval in more than 14,000 leases owned by Hilcorp Energy I, LP. These leases are located in Robertson, Limestone, Leon, and Freestone Counties.
The acquisition is effective September 1, 2023 in accordance with a Purchase and Sales Agreement dated March 15, 2024. Comstock’s acquisition is limited to the depths from the base of the Bossier Reagan Sands down to the top of the Cotton Valley Lime."
It’s possible that Hilcorp could focus on the deeper Cotton Valley Lime, but they have no horizontal well drilling experience that I know of.
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I thought Hilcorp had a farm-out on all their Bossier rights with Comstock?
I don’t believe that Hilcorp is jumping into the deep HV/Bossier Hz play that Comstock, Aethon and Mitsui (among others) are chasing. It was erroneously reported in a Hart publication that Hilcorp was recompleting wells in this section - this was incorrect.
There is a well-defined and limited area associated with this play and its prospectivity. Hilcorp’s legacy position is most updip and outside of this play area.
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Referring back to the Key Energy and East Tx Energy leases in Cherokee and found earlier in this topic, a very reliable source (he called Chesapeake/Expand being in the play last year) was pretty sure that Key and East Tx Energy is EOG also trying to test the deep Bossier play.
That could be true, but why would EOG sit on it for five years while other companies are leasing up prospective acreage in other counties? EOG would want more acreage than what has been leased in Cherokee County.
If Expand is behind the leasing, the wait makes some sense because they have been leasing up more acreage in Anderson, Houston, and Leon Counties.
Hopefully we will learn the answer later this year.
Yes, I see and agree with your statement. Whomever it is better get to work soon even with the extensions.
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