Continental has a gas well producing 6.1 million cf per day since 7/3/16 on our Section 32 14N 13W. This 6.1 million cf per day of production is listed on the OCC website for this well. I was told recently that Continental WILL NOT extract that much gas everyday because it will negatively effect the geological formation that it is coming from. I was told that Continental will choke back that production to 1.5 million cf per day and slow the production down. Can anyone tell me if this is correct since it would obviously effect our royalty payment amount at least in the begining?
Greg,
Short answer...gas wells are almost always choked backed to some degree. If someone associated with Continental told you that it would be limited to 1.5 MMCFD then it most likely be produced at that rate for some period of time. If CLR is drilling offsets they would keep the rate low so they do not create a pressure sink which would attract frac fluids. If info is from other sources I would be skeptical.
Thank you. I appreciate your reply. Greg
They are often choked to keep enough residual pressure to make the crude and other liquids flow for as long as possible.
Do they hold back on the oil production while holding back the gas production?
To maximize total production, wells are routinely choked back. If the gas is over-produced it also dramatically impacts the oil production in a non-linear way. Therefore, in the long run you want them to choke the well back and your income will not only last longer, but in the long run be much higher, perhaps 50% higher than open choke production. It would be a poor operator who runs open choke on a highly productive well.
PLUS, if you are stuck with post-production expenses, open choke production invites a much higher rate of water production (not frack fluids) because water is more mobile than oil, thus the water "beats" the oil to the pore holes and will overwhelm the oil production. And over-producing water means you have much more of it to get rid of...on your nickel (Post-production expense).
Anyone running high production levels in a good well is probably a candidate for bankruptcy because the only justification of it is they are in a desperate cash flow situation. Trust me, producing 5 BCF of gas over 10 years beats producing only 3 BCF in two and then plugging a well that waters out.
Thank you Mr. Shields.