The Dubeil is at 9,700 getting ready to make the turn to horizontal.
Hello everyone ! I am new here. My family owns surface & mineral rights on sec 9 4S 2E. A pooling order has been signed…
Our other property is in Grady County outside of Chickasha
Paul,
XTO, a division of Exxon Mobil, is the big player in this part of Carter Co.
The well has a Surface Hole Location (SHL) in section 4, but the Bottom Hole Location (BHL) is in section 9. Royalties are paid based on the section the horizontial portion.
They may drill more wells, usually, a total of 4. You should see a check in about 8 months, give or take. Probably you will see about $1,000 to $1,500. However, this is a new area a little Southwest of the major play, so anything is possible.
Paul,
Here is XTO website
https://secure.pds-austin.com/xto/intro.asp
You will need to setup an account.
Ok… is the Woodford Shale oil & gas?
Paul,
They may be finished drilling, it takes around 50 to 60 days, but they will need to install tanks and piping. Also fracing, I refuse to spell this with a K as fracturing is not spelled with a K, takes around 10 to 14 days. So you may see some activity.
Thank you Ronald
Good night gentlemen…
Paul,
The spud report tells everyone that the real drilling is starting. When a well is drilled, they install a big, about 12" in dia that goes below the fresh water table, this is called a casing, cemet is pumped down the pipe and out the bottom and up the sides to the surface. This cements the pipe in place and protects the grow water. The pipe are about 1600’, but they vary.
The Dubeil and your well share the same pad. Dubeil is going North and you well is going South. Royalties are paid on the horizontal, not on the Surface Hole Location (SHL).
That’s good news Daniel… you sound very knowledgable. I have one question: I understand that 6 months are allowed for the operator to re-coup costs before first royalty payment, therefore is there an accumulation and a first “big” check for the first 6 months or does the mineral owner just lose those first six months worth of minerals?
Paul,
You will get a first big check and should get this about the end of 6 months or XTO will owe you 12% Statutory Interest from the first day of production. You can go here and set up an account, you must write (e-mail) them and ask for the interest.
Paul,
Both, but mostly Gas. A good well will produce about 200 or so barrels of oil per day and around 3,000,000 cfpd of gas, which is priced in 1,000 cfd or 3,000 mcfd. I suppose your lease is with RD Williams, most seem to be, and you have a 3/16 lease, which is a common lease.
I am pretty sure our lease is with XTO - that’s what is on the court papers, pooling, etc.
Paul,
Your just getting started. There is also a document called “Division Orders”. This document is used by the oil companies to establish your mineral acre and calculate your royalties interests, also based on you royalties (3/16 or whatever) and your address and SSN. This is used to send you a 1099 for taxes.
Paul, i cant tell you whether it is or not. Im sure Daniel can
Daniel,
How many wells can share the same pad ?
Paul,
Here is a rough estimate of your monthly royalties, based on having sole interest in 50 acres, oil at $90 and Natural gas at $3.90.
Paul,
Here is how to determine, approximately your early royalty payments, after you first six month check.
Let’s say oil is $90 a barrel and gas is selling for $3.90 per thousand cubic feet (mcf).
If your lease is for 3/16, 18.75%
50 acre mineral interest (50/640 acres per section) 0.078125.
Therefore, you should receive 0.01464844 of all the product recovered during the month. I know this does not seem like much, but it adds up very quickly.
Let’s say the well is producing 100 barrels of oil per day (bopd) at $90, that’s $9,000 per day or $270,000 per month or about $3,900.
Now, let’s do the same for gas. 1,000 mfcd at $3.90 is about $3,900 per day or $117,000 per month or about $1,708.
Thus in the being you first few checks should be about $5,500 a month for 100 bopd and 1,000 mcfd of gas. This will go down as the well matures. Set some money aside to pay your taxes as you will be getting a 1099 from XTO.
Ah, yes thank you Daniel. I will keep all receipts. Our other interest is in Grady County just outside of Chickasha 305 acres.
OR
is this for the Dubiel 1-4H ?