from the PR Newswire. So, what kind of lease offers are out there?
LUBBOCK, Texas, Nov. 27, 2012 /PRNewswire/ -- Expectations are building for America to become the world leader in oil production by 2017 due in part from what some are supposing could be the largest oil play in American history, taking place on Texan soil.
In the heart of Texas's Permian Basin, lies the Cline Shale, an oil shale field running 140 miles long and 70 miles wide. Devon Energy and Chesapeake Energy, two oil companies, are reporting impressive figures based on the short amount of time they have had to explore. Devon Energy's test wells show the Shale contains 3.6 million barrels of recoverable oil per square mile. With an approximate 9,800 square miles of Cline Shale, this would amount to over 30 billion barrels of recoverable oil, exceeding both the Bakken fields in North Dakota, and the Eagle Ford in Texas by nearly 50 percent.
Taking into account the projected 200 to 550 depth of the Shale, this would be equivalent to having ten Eagle Ford Shales stacked on top of each other. The oil to dry gas ratio of the Shale is also garnering attention, with the Shale containing 85 percent oil and liquid rich gas. When you combine that with the low operating costs it takes to produce the oil in the Basin, about 50 percent less than the Bakken, it is shaping up to be one of the greatest oil & gas booms America has ever seen.
You're welcome. Would like a little help on recent lease agreements... Royalty % and bonus payments. I hear a lot said about the Cline but little information available for mineral owners. Thanks.
Robert M. said:
Good article Jack, thank you very much for sharing.
Richard, We’re not quite down to County hotspots quite yet. The Cline Shale is in the areas mentioned for our group here. A much larger area than the maps this far have indicated - that’s how plays go. As for general
Counties to estimate hotspots - companies are aiming for the thicker intervals - earlier posts in our group
should help show general areas. NE Midland Basin Counties, southern Midland Basin Counties and further to the west and SW of the Permian Basin have thicker Wolfcamp intervals and therefore likely thicker Cline Shale potential.
Jack- I’ve not heard recent bonus numbers - I think the going rate for RI these days is 25% RI. The big thing that irks me no end is that companies often have language that has the mineral/royalty owners paying the production costs (compression, lifting, transport) - that can reduce checks significantly (like 20%-ish)!!!
O&G Attorney, Minerals Manager, in other words Real Pros are necessary.
yes, that is helpful. deductions can be horrible. family is aware of one company that deducts an awful lot. we plan to stay away from it unless lease language is very clear. but some companies are very sneaky. thanks for the reminder warning.
Ralpr said:
Jack- I've not heard recent bonus numbers - I think the going rate for RI these days is 25% RI. The big thing that irks me no end is that companies often have language that has the mineral/royalty owners paying the production costs (compression, lifting, transport) - that can reduce checks significantly (like 20%-ish)!!!
O&G Attorney, Minerals Manager, in other words Real Pros are necessary.
PR Newswire