This is a new one for me.
Continental has filed an application to drill a multi-unit well in Section 9 and 4, Township 16N, Range 11W in Blaine County. We have interest in Section 9 where the drilling pad will be placed. They have applied to have the pad placed 2,000 feet into Section 9 from the south boundary. The application states that the revenue sharing estimate is 33% to Section 9 and 64% to Section 4. I called Continental to find out why they are doing this. The answer I got was that they have 5 sections stacked from south to north that they control being 16, 9, 4 in 16-11 and Sections 34 and 28 in 17-11. They want to drill 9 into 4 at 1 1/2 miles and drill 16 into 9 at 1 1/2 miles, and 34 into 28 of 17-11 as a two-mile well. They want to do this due to the section line correction in between the townships. They assured me that this has been done around Thomas, OK and that the OCC has approved those requests. They also assured us that these wells are slated to be drilled within a year.
My concern is that Section 9 is held by production on 1/8th lease executed in 1977, and that Section 4 is not held by production and those leases will start to expire early in the spring of 2016, and they are not fully developing Section 9 for that reason. I have no proof that they are filing to drill on Section 16 as a multi-unit anytime soon, except for what this Continental Land Man has told us.
Has anyone ever heard of this? And if so, why only develop half of the section?
This sort of well is very common. There can be several reasons for half a section. Might be a fault, might be topography and they need a flat spot, and other reasons.
CLR has Horizontal applications in for 4/9, 7/18 and an additional location exception by Chesapeake is in 36.
Thank you for your reply, M Barnes.
The best info that I have is there is no known fault in this area, and the topography is relatively flat. There are no obstructions that would prevent them from locating the pad closer to the south boundary. Just makes me curious as to why they would want to develop this unit in this way. Of course, we would prefer they try to develop more of Section 9 where we have mineral acreage. It could be years before any infill drilling comes into play. If they do drill from 16 to 9, then my concerns are moot, but I don’t have any assurance that will happen.
Thanks.
Richard; Continental has been very successful with these multi-unit wells in the Grady and Stephens County area and it has led to many wells in a section. You might read the Grady and Stephens County forum for information of this type of drilling. In fact, one of the first multi-unit wells completed in Oklahoma was in Blaine County by Continental.
I received the notification of hearing about this about six months ago. Apparently, it keeps getting continued and they aren’t able to be granted permission to carry it out.
It is very common to be delayed in this pricing environment. These things take time to develop.
Yes, I understand the 2 mile multi unit wells. We have an interest in that first multi unit well with CLR. It is the Toms 1-21XH.
The first hearing on this well is October 6th that I am aware of. We did not receive any communication on this until a couple of weeks ago.
It could’ve been a different well. I’m just saying there seems to be a lot of this type of thing happening right now. Someone tried to tell me that there is no monetary compensation. That doesn’t seem right to me. That may not have known what they were talking about though.
If you are a rightful royalty owner, you will be compensated. The alignment of the well gives plenty of room for additional wells if and when the time is right. There are several set ups like this in Stephens, Grady and Garvin. Looks like they are avoiding the other wells and their pads that previously exist and go into other horizons. See Exhibit B on the cause # 201504467 (at the very end).