Sounds good to me, thanks for your help again. It’s is greatly appreciated. Have a nice weekend “go broncos”.
r w kennedy said:
I think it is the standard, a month behind to get the oil sold and a month to calculate and send the royalty out.
Hello mr Kennedy! Got a question for you?Where do we find how much our oil is selling for?
Robert shepherd said:
Sounds good to me, thanks for your help again. It’s is greatly appreciated. Have a nice weekend “go broncos”.
r w kennedy said:I think it is the standard, a month behind to get the oil sold and a month to calculate and send the royalty out.
Mr Kennedy, I have question for you where do we find out the price that our oil is being sold at?
The price your oil is being sold for will be on your royalty check. If your oil sold for more than $25 less than WTI commodity price and your production is more than minimal, I would do some more research.
Thanks I will keep researching.
Mr Kennedy, I was looking at some of the older wells in the bakken. Those that have been pumping since 1955 or so.They produced for 40 yrs or so but with significantly less oil produced yet remained fairly consistent… Now with the new wells like ours along with the new technology used on our wells can we expect the same longitivity but with more quantity of oil produced? At least that’s what it appears to be. What is your take on the subject?
Mr. Shepherd, it is aruable when wells like "ours" were first drilled because the completion techniques used today have been incrementally developed over the last decade. My wells that were drilled 2007,8,9 produce only half as much, or less, oil as those drilled today in the same areas, and I can easily see them producing for 50 years or more because the oil can't get into the pipe very well or fast. There will also come a time when the operators try to strip the dregs of these wells and they will have months where they are not produced/ pumped but one day a month to pump out whatever oil has slowly migrated into the wellbore. In the later years of our wells, those older ones like some of mine and newer ones with better completion techniques, production may be low but it adds up over decades and the measure of a well is how much wealth it creates before it is plugged and abandoned, not instant riches. I'm in it for the long haul, for myself and my heirs.
There will also be secondary recovery, it is already being discussed and waterflooding to wash the oil from the rock and pump it to the surface has already been attempted. CO2 injection will also be tried, I believe with good success.
There is also the matter of the overlarge spacings, which need more than one well to drain it and may require 10 wells in a single formation to drain it to the extent desirable and economic. You could well be over multiple formations and your last well may not be drilled for 40 years. Completion techniques have come so far in the last 5 years that God only knows how they will have evolved in the next 40 years.
The concerne of how long production will continue is not a matter of the present well but of the last well drilled in your spacing and the completion of any secondary and tertiary recovery operations which your heirs may not live to see the end of. I believe we will both be long passed before they stop squeezing oil out of our mineral rights.
2/3 of the oil may come out of a well in the first 5 years and the remainder in the next 35 years, this is not a problem with the well but a problem of the dissatisfied mineral owner's perception of the well because the royalty was so small that you have to have alot of acres if you are going to give up 80% of the profits. If you clear $100 per month off your leased acres after taxes, the operator will clear $420 a month off your acres after taxes because they have deductions and the oil company usually has a large leasehold and are making significant amounts of money and they are satisfied. The operator may have hundreds of wells like yours also, they don't have to make all of their money off your well.
These wells in ND are primarily oil wells, oil does not come out of the ground as fast as say the gas would from a gas well in Oklahoma that might only have a significantly [to the mineral owner] useful life of 15 years.
Our wells will have a long life, whether you are satisfied by them will be a matter of our own perception because the well is not going to change although later wells may differ from the first.
Short answer is I expect them to be long lived and since we are in overlarge spacings, it's not the life of the first well but of the last well that matters.
Thank you very much for that in depth answer. My mom has about 3pct interest in what will be 7 wells at the completion of this first phase of drilling and with that much interest I think she will be ok for awhile.
r w kennedy said:
Mr. Shepherd, it is aruable when wells like “ours” were first drilled because the completion techniques used today have been incrementally developed over the last decade. My wells that were drilled 2007,8,9 produce only half as much, or less, oil as those drilled today in the same areas, and I can easily see them producing for 50 years or more because the oil can’t get into the pipe very well or fast. There will also come a time when the operators try to strip the dregs of these wells and they will have months where they are not produced/ pumped but one day a month to pump out whatever oil has slowly migrated into the wellbore. In the later years of our wells, those older ones like some of mine and newer ones with better completion techniques, production may be low but it adds up over decades and the measure of a well is how much wealth it creates before it is plugged and abandoned, not instant riches. I’m in it for the long haul, for myself and my heirs.
There will also be secondary recovery, it is already being discussed and waterflooding to wash the oil from the rock and pump it to the surface has already been attempted. CO2 injection will also be tried, I believe with good success.
There is also the matter of the overlarge spacings, which need more than one well to drain it and may require 10 wells in a single formation to drain it to the extent desirable and economic. You could well be over multiple formations and your last well may not be drilled for 40 years. Completion techniques have come so far in the last 5 years that God only knows how they will have evolved in the next 40 years.
The concerne of how long production will continue is not a matter of the present well but of the last well drilled in your spacing and the completion of any secondary and tertiary recovery operations which your heirs may not live to see the end of. I believe we will both be long passed before they stop squeezing oil out of our mineral rights.
2/3 of the oil may come out of a well in the first 5 years and the remainder in the next 35 years, this is not a problem with the well but a problem of the dissatisfied mineral owner’s perception of the well because the royalty was so small that you have to have alot of acres if you are going to give up 80% of the profits. If you clear $100 per month off your leased acres after taxes, the operator will clear $420 a month off your acres after taxes because they have deductions and the oil company usually has a large leasehold and are making significant amounts of money and they are satisfied. The operator may have hundreds of wells like yours also, they don’t have to make all of their money off your well.
These wells in ND are primarily oil wells, oil does not come out of the ground as fast as say the gas would from a gas well in Oklahoma that might only have a significantly [to the mineral owner] useful life of 15 years.
Our wells will have a long life, whether you are satisfied by them will be a matter of our own perception because the well is not going to change although later wells may differ from the first.
Short answer is I expect them to be long lived and since we are in overlarge spacings, it’s not the life of the first well but of the last well that matters.
Mr Kennedy, over on the production data at the ndic, does every run equal a barrel?
Mr Shepherd, every run is a barrel sold. Some months more is sold than produced and some months less than produced that month because there is always something in the tank.
Thank you