Has anyone dealt with Mosaic Pecos LLC, Mosaic Exploration Operating or possibly other entities with Mosaic in their name? Specifically, wondering about Section 1, Block 10, Pecos County, TX. but any experience with or information about this company, even in other Texas counties or locations, would be appreciated.
Mosaic the Potash Company?
I believe they’re involved in oil & gas exploration and with production as an oil and gas operating company.
Link to an article about Mosaic if you haven’t seen it. https://www.fastcompany.com/91116921/abandoned-oil-and-gas-wells-pollute-texas-landscape
Very interesting article and it highlights the real failure of RRC to require companies to plug wells which have ceased producing for years, many for decades. Some wells are listed as “shut-in” which means that valve is turned off, but pressure needs to be regularly monitored to ensure that oil, gas and produced water do not breach the surface. Others are listed as “temporarily abandoned” which means that there is a plug inserted to prevent movement of oil, gas and water between formations. These are only short term measures and the oil company should produced or plug. Instead some companies simply disappear and others assign the unplugged wells to smaller and smaller companies so wells end up with operators without any assets. As of Aug 22, there are 8,110 wells on orphan list. And so many more non-producing wells which have operators without the financial ability to plug and which will eventually be added to the orphan list. The required bond is not sufficient to plug these wells.
Dusty1 … no, I had not seen this article. Thank you very much for sending the link. Very helpful.
TennisDaze … thanks for your comments and for the explanation of the various terms. I appreciate it.
TennisDaze - I’ve appreciated your insights and concerns about plugged/abandoned/orphaned wells. I’m wondering if you’ve ever heard of operators delaying plugging as a way of holding lease acreage or maintaining a foothold on a lease? And is that preventing royalty owners from re-leasing their minerals because of the lease-hold from inactive wells? Is that different than a shut-in? I’m a new mineral owner and NARO-TX member and I’m trying to get up to speed and I think the orphan wells question is very pertinent to royalty owners… Thank you!
This is actually a complicated question. It is really a question of production. Often leased minerals are pooled into a unit which multiple wells, each of which will hold the unit in operation under the terms of the Unit Agreement or Designation. Shallow units with vertical wells tend to have more wells. Suppose the unit has 20 wells. Then suppose 19 are shut-in or inactive. The single remaining well can hold the unit and all leases. For this reason, you should get a copy of the recorded unit agreement to see what determines its termination, such as no production or operations for 6 months. Complicating factor where all the wells under a lease are shut-in and the the operator makes annual shut-in payments for wells under the leases. Many older leases do not limit number of years, for example to 2 years cumulative, and an operator can sometimes play games with this. Get and retain copies of all your leases so you can see what the terms are. Many are only recorded as a memorandum. NARO will have a lot of information to access. And there are articles available on the internet.