I have an interest in around 20 acres in this section. Hardesty 1-14 was producting gas from 2005 thru 2009 but had dropped to zero production. Well is now considered shut in. Received a shut in check in the amount of $6.25 May from St. Marys to preserve the lease. Have not cashed the check. Is this a fair amount for a shut in well? Does this give them permission to reopen the well if they choose or to drill?
Is this the first check for shut in well . When did they shut the well in ?
No…I believe the shu
Sorry shut in probably in 2009
I looked and your lease has no limit on how long they can keep the well shut in as long as they pay the rent they can do what ever they want with the lease . They can reopen it or drill a new well if they choose, or let someone else and you will get 3/16th of any new well.
So should I offer it to another company or…
You can"t offer it to another as long as st mary holds the lease.
If I don't cash the check is the lease still valid?
As far as I can tell it is. But if you are not sure don't cash it.
Get a good attorney to look at this. Your lease may not have a cessation of production clause and the lease may allow for shut-in payments to hold the lease. But the spirit for a lot of the shut- in clauses in leases were due to handle wells being shut- in due to pipelines not wanting the gas.
This has not been the case over the last 10-20 years. I do not think the shut- in clauses were relevant when the well is not capable of producing. Also trying to hold a well that has not produced in 5 years with shut-in clause is tough. Operators have a duty to develop your acreage.
These are all legal points that you should discuss with a good attorney. But if the well is in an area where bonuses are good, I think it would be worth having the attorney look at it and express your opinion in a letter or two.
Good luck