Ms Leitner, it is unknown how it might play out, but I have a hunch.
Larger O&G co. often use a small one for the leg work putting together large blocks of leased acreage.
Shale & Apache struck a deal many months ago (or even earlier).
In July/Aug? Shale announced they’d halt leasing as of Sept 1.
So my hunch is that Apache/Shale both agreed to the Sept 1 cut off, and therefore all leases signed prior to then should be honored (paid). Paid by whom is inconsequential, but I suspect Apache wants (or will take) them. The form letter Brian received just confirms Shale is no longer actively pursuing new leases. It doesn’t refer to voiding or declining to honor previously signed leases.
None of that is set in stone, so don’t spend money you haven’t received. With dry holes this fall, Apache can still walk away on the yet to be paid signed leases. Though that possibility seems doubtful since they’re relatively cheap leases valid for ten year terms. If their drilling is successful it will cost them considerably more to buy shorter term leases in the future.
Big Daddy, that is the wonderful thing. Getting an offer call on the heels of an announcement like SE’s and with Apache knowing what they drilled into, there is no way to tell if it might not be an offer from SE or Apache through another intermediary. I would be wondering.
Gabrielle, no it doesn’t mean oil is there for sure. All it means is that Apache Corp is willing to take a gamble that it might be. For what it’s worth, Apache agreed to buy out Shale prior to any drilling.
Considering the size of area leased (400M acres) Apache will need to drill at least a half dozen wells spread across the play before they know if it’s worth continuing to drill. Since drilling has only just begun, at the earliest Apache won’t know until sometime next year. The public probably won’t know Apache’s results until next autumn or later. At this point all you can do is put it out of mind and be patient.
Billy Bob, It’s a real possibility with all of the acreage Apache has gathered and most of the more productive acreage in ND has not got a second well on it, and not even counting the less attractive but still commercially viable acreage in ND that still does not have a well at all to hold the leases. If you really wish for your lease to expire you might try to determine how long your neighbors leased for, some of whom probably did lease for longer term and factor that against your holding in any particular spacing to get a ballpark of what kind of priority your spacing would have. Of course you have plenty of time to gather more facts before you do that. Every tidbit of fact is another piece of the jigsaw puzzle.
Billy Bob Jim Bob, I think there is a good chance that Shale Exploration was buying all the leases for Apache to begin with, that the leases always did belong to Apache and when SE completed their commission for Apache, they just assigned all the leases en mass. All of the we are not flippers and we are here to stay was just the usual land man / company B.S.
Cousin Billy Bob, I’m not “in the industry”, but O&G is my business.
Mr. Kennedy’s suggestion is something I’ve wondered about too. Was Shale always Apache’s leasing company, or did Shale start leasing then found Apache while marketing their prospect? I’m not sure which way it went down.
The former seems the most likely. Though Shale’s new “Donco” project in McCone & Garfield counties looks like the latter. I doubt this is another project on behalf of Apache. It appears to be classic speculation. Shale blocks up cheap acres on the fringe of a play then seeks an interested party to whom they can sell their ‘package’ with a markup. That is a fairly standard model in the oil business. Either way it’s nice to see the activity extended into a new area of the state.
Thanks rw. Another factor is that our acreage is a sizable portion of 4 sections. Not sure how apache will unitize. At a minimum we would be a part of 2 units. Depending of course on how they divy it up.
apache corp has an add in this weeks Daniels County Leader looking for a contract position. as I recall it is for a oil production wellsite manager or monitor or some such thing. Strictly Daniels County, lists various experience and resource requirements.
To me it said production was forthcoming and they are lining up help.
Bonnie you may well be right. However, title search is done section by section. Sometimes that title work is even done quarter section by quarter section. It all depends on how a piece of land was homesteaded, and what subsequent land/mineral sales occured. So if you have an interest in sections 1, 2, and 3, title work on one of those will be done before the other two. That is just the way it is.
Patti, don’t expect your lease bonus payment any earlier than the due date. So in the meantime just relax. Then if your bank draft payment date is still 45 days away, give them a call or send a letter about ten days prior to that date. It may not expedite anything but it may prevent it from dragging out beyond the date.