That is quite a distance from A-20 Sec 9 where I believe another land company has leased on behalf of Oxy. I believe other lands have been leased west and southwest of Seminole. This would tend to confirm the very large amount of acreage I have heard mentioned. I have also heard the target area is bewildering like a Chinese checkerboard pattern. I would hazard a guess that the sticking point had to do with deductions?
Post-Production Cost Deductions in Texas--Part II
XTX%20leases%20near%20Cedar%20Lake.JPG
All the green dots indicate XTX leases recorded in the last 60 days near Cedar Lake (source: DrillingInfo)
Searching "X T X OPERATING LLC" on TexasFile.com yields nine pages of recordings dating back to April 11, 2017. I can see how someone might see the collective target area as resembling a Chinese checkerboard after viewing your drillinginfo image. In Clint Liles drilling permits post a Zarvona Energy has permitted a number of directional wells with depths of 6500'. Clearfork? My info quest which is focused more south of Seminole has revealed leasing in BLK A-20 Secs 1,2,5,7,and 9; Blk A-21 Secs 1, 5, 20, 21, and 22; Blk A-22 Secs 1,2,8,9, and 10; Blk C-44 Secs 20 and 21; Blk AX Sec 1 and 2.
Donald, am trying to find an attorney to write a lease for me and would appreciate your letting me know who you used. Most lawyers i talk to don't sell the leases but want to negotiate the lease instead. Thanks very much
Ann, Buddy Cotten is a forum expert and advertiser and might have oil lease forms for sale. http://www.mineralrightsforum.com/profile/BuddyCotten
One thing to consider, leases need to be be updated when there are changes in case law, etc.
Ann,
I have been extremely happy with Joe Christina, who is a Texas Oil and Gas Attorney with Porter Rogers Dahlman and Gordon in Corpus Christi.
Many thanks for both the suggestions.
I inherited my fathers mineral rights in Gaines county. And I know absolutely nothing about leasing. Can anyone tell me how to figure what percentage I would have in a particular section?
Thanks
Jean Merrell
Not a Land Man, a retired CPA from Midland, TX.
I was quail hunting with some head guys who were talking about their largest USA drilling prospect. Without saying anything to them I figured out how to purchase minerals under this project.
I am from Levelland, Tx; strictly an oilfield town so I grew up around this stuff, and had a basic knowledge of the fundamentals.
The info I now get from OXy, Apache, Amarada, etc. are guys I went to high school with.
Michael Purify, Is it one large drilling prospect of one company in Gaines county, or is the drilling prospect shared by multiple companies? I believe Oxy bought Hess' properties in Gaines last summer for $600 million, and Apache has its huge Alpine High prospect in Reeves county. Has Oxy been leasing in a large target area of more than 100,000 acres in Gaines? How did you adequately inform yourself about the subsurface of your acquisition?
Oxy is in it big time now, do not know all the details, yet. But I am about to find out.
I looked at the 3-D around 1999 and it was amazing. Chevron, Apache, (maybe Amarada Hess & me started buying minerals under what looked the best sections.
Originally the 1998 3-d was mostly oil...on the recent 3-d, Oxy saw huge gas play (along with oil) that had not shown up on the earlier 3-d. And they have a sizeable four year project in the making, I mean they jumped in with booth feet. Was told told about three days ago Oxy is building a huge pipeline into that area, not sure where it starts.
The Shale Play company was trying to lease was under three (maybe 4 sections)...they had drilled Shale across the USA, but that doen't mean they are right on this one.
Amarada Hess was going to put aa huge drilling prospect together on three of these sections...not sure what happened, they moved the rig in on the very last day the lease was to expire & went somewhere else, think over seas. Not sure what happened but several engineers were fired.
So Apache tried to work some kind of deal with Chevron where Apache would do all the drilling for Chevron if they could work out a deal...Chevron declined. You would not believe the large companies Chevron has said 'not' to.
Then I was offered $1000. & 1/4 per acre on this particular section, and I thought Chevron would bite on this one, the didn't. What I was told, the company wanting to lease had located what they thought was a 'shale play' under all this...including the gas&oil on 3-d. Not sure who the companies were, i'm sure Oxy was one but their budget increased from $1,billion bucks to $4,billion over the next three years
So I am still trying to figure a lot of this out as far as who is really working together vs acting for others under other names. Think this is going to really surprise some people when it all shakes out.
I'm sure some of this is off-base but a lot of it is solid.
I spoke with landman who was leasing for Oxy south of Seminole. He indicated Oxy was pursuing a Clearfork CO2 project. Ring Energy also has horizontal San Andres activity.
Ring Energy has a lot of land in Gaines, too. So there is conventional SA hz drilling, and there is also depressurization of the San Andres ROZ as well as greenfield San Andres ROZ flooding with CO2 . If my source was correct, there is also Clearfork CO2 in the works. Oxy is the CO2 king, so it would be interesting to learn if the pipeline is for CO2. The Hess acquisition would seem to be a 'bolt on' for scaling.
Something else, i haven't studied the details of a Shale Formation nor understand it.
When the leasing company said they located what appeared to be a decent Shale Formation under a couple of sections they offered a very high price for...I had no idea what they were talking about. But locating a drilling Shale is their big deal and hard to realize there my be smaller pockets of Shale based on maps.
Speaking of Apache & Oxy...I read about a month ago that Apache was a prime target for a takeover due to their stock price being so low and the high expense of basically creating a reliable civilization of far West Texas. Two companies mentioned were Oxy & ?(cant remember, maybe Anadarko,
The company that stood a good chance of taking over Apache fit both profiles. They would become the biggest players in the Permian Basin area (maybe they were talking about this new stuff-I don't know). But both companies had projects going in Egypt and a few others I cant think of. Think both had a lot going on in Oklahoma to boot.
I traveled thru that area about a month ago going to Presidio. You wouldn't believe it, I mean that, you would not believe all the pipe lines, booster stations, drilling, building roads all over the place...every phase of an oil operation you can think of.
These next two or three years are going be something to behold.
The guy I get OXY info wants to purchase a few minerals from me, so he has been solid so far.
OXY getting into that area really surprised me, as a matter of fact it was a shocker. The only time I really followed OXY was in the Levelland (Hockley County area). They purchased a huge what was thought to be a depleted field from Amoco and did some amazing things based on what you just said.
Here is a comment re OXY & co2/flooding, etc.
n 2017, OXY's United States operations produced 304 thousand barrels of oil equivalent (1,860,000 GJ) per day, representing 50% of the company's worldwide production. Substantially of this production was in the Permian Basin, where Occidental is the largest operator and oil producer. The company produced 141 thousand barrels of oil equivalent (860,000 GJ) per day from unconventional oil via Permian Resources and 150 thousand barrels of oil equivalent (920,000 GJ) per day using a technique called enhanced oil recovery, whereby carbon dioxide and water are injected into underground formations to extract the oil and gas.[1]
This RRC pdf deals with C02 flooding of the San Andres ROZ in Gaines county.
It is also possible to tap some San Andres ROZs without injecting CO2.
https://www.mrt.com/business/oil/article/CO2-Conference-adapts-alongside-oil-and-gas-10652755.php
he Permian Basin is renowned for its stacked plays – up to 3,000 feet of potential producing formations, some of which have yet to be developed.
3000 ft of potential stacked producing formations...that's simply amazing.
Gaines is county is loaded with the San Andres possibilities your spoke of andI I've heard more about Wolfcamp, than the Clearfork. And 3000 ft of stacked payzones.
This could be a landscape changer.
Ring Energy hz San Andres permits south of Seminole. Are the deeper wells targeting a ROZ? Is "M" a lucky letter for a lease name or ?
Ring Energy to drill 60 new hz wells this year:
MIDLAND, Texas--(BUSINESS WIRE)--Ring Energy, Inc. (NYSE American: REI) (“Ring”) (“Company”) today released its operations update for the first quarter of 2018. In the three months ended March 31, 2018, the Company drilled 12 new horizontal San Andres wells, one new horizontal Brushy Canyon well, three saltwater disposal wells, and was in the process of drilling two additional new horizontal San Andres wells at the end of the quarter. Of the 13 drilled wells, 12 were one mile long and one was ½ of a mile long. In the first quarter, the Company completed, tested and filed Initial Potentials (“IPs”) on 12 new horizontal San Andres wells – 11 wells which were drilled in 2017 and one well drilled in the first quarter of 2018. The average IP on the 12 completed wells in the first quarter 2018 was approximately 436 Barrel of Oil Equivalents (“BOE”) per day. In addition, the Company had 20 new horizontal San Andres wells which were in varying stages of drilling, completion and testing on March 31, 2018.
As a result, net production for the first quarter of 2018 was approximately 507,000 BOEs, as compared to net production of 266,000 BOEs for the same quarter in 2017, an approximate 90.6% increase, and net production of 422,000 for the fourth quarter of 2017, an approximate 20.1% increase. March 2018 average net daily production was approximately 6,005 BOEs, as compared to net daily production of 3,618 BOEs in March 2017, an approximate 66% increase, and net daily production of 5,352 in December 2017, an approximate 12.2% increase. The average estimated price received per BOE in the first quarter 2018 was $61.50.
Mr. Kelly Hoffman, Ring’s Chief Executive Officer, stated, “The momentum of 2017 has continued into 2018. Our daily BOEPD is up over 66% during the past year, and as we stated on our last conference call, we continue to see double-digit growth quarter over quarter. We are on track to drill 60 new horizontal wells this year, and with results exceeding all of our expectations that growth looks to continue for years to come. We have completed our gas gathering pipeline and are starting to sell our gas associated with the horizontal drilling, instead of flaring it, which will significantly increase our gas sales going forward. We have also started to restimulate some of our older horizontal wells that have gone through their normal production decline and have seen great results. This is very cost-effective, and we have seen daily production increases of over 50% in some wells. The first horizontal well on the North Gaines Property has been drilled, and management is determining the most optimum completion technique. Results have been encouraging, and we are in the process of evaluating the best technique to maximize our returns. Our first horizontal well in the Brushy Canyon formation on our Delaware Basin Property has been drilled and is awaiting completion. We remain focused on our goal of being cash flow positive by year end. With no debt, a strong balance sheet and a talented team behind us we look forward to continued growth and success the rest of the year and beyond.”
About Ring Energy, Inc.
Ring Energy, Inc. is an oil and gas exploration, development and production company with current operations in Texas.
www.ringenergy.com
Safe Harbor Statement
I am wondering what accounts for the very different production numbers? Ring Energy's Minerva lease well oil production: