I received a letter from Jackfork land on behalf of CLR yesterday regarding a new well called the Celesta 1-5-32XH in section 5 Stephens and 32 Garvin. There are already 2 Condits in Section 5. It says they are testing the Springer formation. My question is… I’m already leased and pretty sure that lease had no depth clauses. I’m wondering why they are asking for me to make an election-participate in the well or choose lease terms. Any thoughts?
Martha, It was a lease. I’ll give them a call Monday. I bet they didn’t check for previous leases. Thanks! Vicki- it is 32 3n4w.
Jennifer, were you leased with a real lease or force pooled?
If you were leased, then you probably are only getting the chance to participate since the Springer is above the Woodford which was probably the focus of the first lease. You might want to call or write the landman who sent you the notice to clarify.
If you were force pooled, then you might have a second chance to get lease terms again if the first force pool was only for the Miss, Woodford and Hunton. That has been happening.
Go back to your records and see where you stand and if still confused, call the landman and clarify because they probably just sent out their basic form letter and didn’t check against previous leases.
Hutch: Well the Poteet is a great well…so I imagine it will be profitable even with considerably lower prices…but there are a lot of other wells that are more marginal. I just hope they don’t do to oil what they did to gas price wise with too MUCH production.
Jennifer, what township/range is that sec 32 in? I have a lease that is about to expire in 32 2N 3W that I was hoping to collect lease bonus on one more time before they drilled.
Thanx, Jennifer. After I sent you the message my giant brain engaged and it occurred to me that would be the only way Stephens 5 and Garvin 32 could adjoin.
Precision 50 has moved off Poteet 3 and on to Jerry 1-15H
It looks like another Springer target.
Yeah Buddy!
So does anybody know the break-even price of crude for this area and method of extraction? It’s @ $83.03 now (Tuesday afternoon), with the low seventies predicted by some.
B/E within the condensate fairway of the SCOOP is much lower than $75. I’d guess maybe $50. I’d reckon that’s the case with the best plays (Eagle Ford, Bakken, Permian).
The one thing the SCOOP has above all other plays is that it benefits enormously from its proximity to Cushing. Good infrastructure = low price differentials to Nymex. The Bakken on the other hand has large differentials because most of the crude has to be trucked or railed. ND and Montana have been experiencing $10-$15 differentials recently (ie…if Nymex is $80 the field price is $65-$70).
John M Robyn Huebner 405 82 0 6593
Thanks Huey. This article pegs the BEP for US shale at $75, much lower than Canadian tar sands. http://www.ft.com/cms/s/0/9cc592a4-537d-11e4-8285-00144feab7de.html…
Wood Mackenzie, the consultancy, estimates the majority of US shale production will break even at $75. The International Energy Agency said on Tuesday steeper drops in the price of oil are needed for US shale and other unconventional energy production to take a meaningful hit.
McElroy 4
382bbls and 7385mcf
Just to add some perspective, the crude contract hasn’t moved much in the out months. The prompt month contract has been decimated (down $15 in the last 2 weeks), but the Jan 2018 contract for example has only gone down $4 in the same time period. I think it’s important to remember that these guys aren’t just drilling for the next 12 months. They are building inventory for years of drilling and basing that inventory on the futures contracts. That’s why they hedge so aggressively.
And don’t get me wrong, the current price is important but the long term price is more important. At some point the operators knew that the backwardation would get worked out of the futures market. I don’t think anyone expected it to be so soon but here we are…and in turn the forward curve has flattened out.
Hubby went for a short tour of the diggings in 2n4w today. He said there were two new locations being built just south of what he thinks are the Yandells. So I’m thinking they are in section 27. The new Honeycutts? That’s my guess.
Also said there was a new rig in section 14 (he thinks) so guess that’s one of the new Kellys. Also said there was a rig just west of the Vanarkel. Would that be the new Jerry? Bet Jerry Condit never thought he’d have a well named after him much less several wells! Guess we should have gotten his autograph while he was just a peon like the rest of us! lol
Vicki, I wondered if that was the problem. Linda needs to stepup her game, 20 hours since her last post!
And?
Did anyone see Hamm from CLR on cnbc’s Cramer show last night? He said he thought oil would be back around 90.00 in 3 to 4 months. The the CEO from Chieniere (LNG) said just the opposite saying he thought it would go to 70.00.