I am a passive investor that is trying to follow activity in Divide county specifically as it relates to American Eagle. This board seems to think the Bakken hunter wells @ 161n 97w a very good wells. AMZG has land @ 163n 97 w. First time poster. I hope I am not intruding.
Each Township and Range is 6 miles x 6 miles which results in 36 one square mile sections per Township and Range. That means a section in Township 163N is 12 miles north of a section with the same number in Township 161N. It works the same for the Ranges east-to-west. Hope that helps!
Mike, welcome. Mr. Hagen answered the distance question.
I think there is another question implied, how far am I from what you have been told is good? From taking a look and considering the methods, If your investment is aided by holding large amounts of relatively unproductive acreage long term to profit from it's appreciation in the future and you are achieving this at reasonable cost, you are right on track.
If you expect to profit near term from a wells production, I don't think you are in the right area. From the few examples of wells in 163-97 they will be a long time paying off, decades. The operator can profit from appreciation of the acreage and does not have to go through 6 or 7 lease bonus cycles to maintain controll of those acres by drilling a relatively cheap, marginal low producing inefficient well. If it were not for considerable savings for the operator who wants to hold the most acreage he could, I seriously doubt they would be drilling XXL 2 mile lateral wells with such low field pressure, because there is hardly any flush production to aid in quick cost recovery.
Simply, if your profit comes from owning the real estate and you do not expect a quick return, I still think it's marginal when you consider the cost of capital but I'm not a CPA and the writeoffs could be wonderful. If you are wanting to profit from production from this area it will be a long time returning your investment 15k to 25k barrels in the first year is not promising for an XXL 2 mile horizontal well. It would be much better on a 640 acre 1 mile lateral well because the profit per acre would be double that of a 1280 spacing. As it stands, from the wells I looked at if someone leased their acres they might be receiving $150 to $250 per acre for the first year assuming 20% royalty which I doubt very many people in that area got. In succeeding years it goes downhill from there, possibly quite sharply. If I wanted to make money from production I would look about 10 miles east. I would rather buy / invest in a group that paid $3,000 per acre in that area than one that paid $1250 to $1500 in 163-97, not least because the farther east area has a better chance in my opinion of getting a second well, which I would consider necessary for a reasonable return within a reasonable amount of time, because of better production and closer to the core infrastructure. This is just my opinion from some 3,000 hours of study and looking at literally thousands of wells, in fact, the well I looked at in 161-97 belongs to another new member and I had recently looked it up, this happens to me alot. I am under 11 wells that the oil companies admit to and 3 more I'm working on. Possibly this is more than you ever wanted to consider but I think a couple of hours of research could help you decide that maybe you could get a better return elsewhere. I think investing in the Bakken is a great idea, I think you still need to be selective what part of it you invest in for best results and realize that the operators imperatives may not compliment your goals.
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RW, what does it mean you are "under 11 wells". Thanks. Kathy
Kathy, It's a way of saying I have several different parcels of land in different locations and operators have drilled 11 wells directly on or on acres pooled with mine. 4 Conoco wells, 6 Kodiak wells, 1 SM Energy well. I am in the process of getting Conoco to admit I have interest in one more well and Enerplus USA has drilled 2 more wells on my great grandfathers original homestead which I am more than fairly certain did not leave the family.
Oh, wow! Your great grandfathers home? Do you have to get a lawyer involved for that?
Thanks for explaining the "underwell" question. That helps! Kathy
r w kennedy said:
Kathy, It's a way of saying I have several different parcels of land in different locations and operators have drilled 11 wells directly on or on acres pooled with mine. 4 Conoco wells, 6 Kodiak wells, 1 SM Energy well. I am in the process of getting Conoco to admit I have interest in one more well and Enerplus USA has drilled 2 more wells on my great grandfathers original homestead which I am more than fairly certain did not leave the family.