Monday, February 4, 2008

January Scorecard For Mountrail Co.

Larry put some statistics together for last month:

At month's end there were 19 drilling rigs on location in Mountrail County: EOG 7 rigs; Hess 4 rigs; Whiting 3 rigs; Fidelity 2 rigs; Brigham, Hunt, Murex 1 rig each.

During January there were 12 wells spudded: EOG 6; Hess 2; Whiting 2; Fidelity 2

During January NDIC issued 32 new permits to drill: EOG 15 permits in Model, Parshall, Wayzetta, and Austin Townships. Newcomer Behm Energy 7 permits in Osloe and Spring Coulee Townships. Whiting 3 permits in Crane Creek Township. Hess 3 permits in Banner, Idaho, and Ross Townships. Hunt 1 permit in Oakland; Murex 1 permit in Sikes; Fidelity 1 permit in Brookbank; and Brigham 1 permit in Manitou.

21 comments:

ndroy said...

I am a newbie that's been reading this since last September.

I have just found out that I have mineral rights in Mclean county (just south of Mountrail) and have 2 companies wanting to lease my land. Besides taking the higher offer, how would I know the track record of these companies to deliver this to a possible oil well?

Larry said...

Go to this site to find the wells drilled and permitted by the two companies.

https://www.dmr.nd.gov/oilgas/findwellsvw.asp

ndroy said...

Sorry, I mean the companies are leasing outfits.

Thanks, I don't know where to turn to.

david said...

The problem is, the leases regularly change hands, perhaps several times, before they land in the hands of a real driller. THey are swapped around just like home mortages, with each owner trying to sell the lease for a higher price than he paid. It's a giant game, with people trying to make money selling leases all along the way and the poor landowner has no real control over any of it except to say that if you want royalty payments in the event of a well you nneed to lease.

Larry said...

Ask the leasing companies who they are representing. If they are representing a drilling company, they will tell you who it is.

If they are a company leasing land with the hopes of leasing it to someone else at a higher price, then they will not tell you who they are representing.

Earl said...

Make sure you ask for at least a 3/16 royalty (18.75%) 3 or five year is the common term, you, in all likelyhood, will not find out the name of the real operator until the initial lessor gets a big block of leases together, (is done by a leasing company), and finally records them, and than at some point there will be an assignment to the company that will actually develop the area in Mclean County.

Teegue said...

It wouldn't hurt to look this over if you're a newbie at leasing, or even if you're not and need to review things.
https://www.dmr.nd.gov/oilgas/leasingconsiderations.pdf

Anonymous said...

It may also be pertinent to look at public leases in your area like BLM or school land leases. These may give you a good bargaining price to start at for your bonus.

ndroy said...

I've asked both companies as to whom they are representing and their comments were _____ fill in blank with every major oil company. So it looks like they're both playing the field and waiting for action. I tried asking for 3/16 - nope from both. Also tried the BLM/state leases, but they were firm in their offer.

So bottom line, take the most offered, cross my fingers and hope for a 5 year retirement plan to develop.

Anonymous said...

took me 2 months to get what i asked for but they broke down and gave it to me.

Earl said...

Do not be afraid to put a legal notice in the Bis. Tribune, Dickinson Paper & Williston Herald.
List the acres, Desc. Net acres, ect. Call for bids!! Also get ahold of NOGS, Very good one to get involved with...Also Murex,and Contex Energy out of Dickenson, Inland OIl from Bis..

Willy said...

Yeah don't be afraid to take your time this maybe the last time you ever get to lease. From the sound of it you have competition for you lease meaning that it has higher value. The lease that people around here should start considering is one simiular to that of texas univeristy mineral leases.

Earl said...

Whatever you do, make sure you get a Pugh Clause listed in any lease, Meaning one drilling unit drilled, will not hold the lease on all other acres listed in your lease.

ndroy said...

Thanks a lot, guys. I didn't know where to turn to for answers. You've all be very helpful.

Now I'll turn this back to Teegue and the real reason he has set this site up for - ND Bakken information.

And thank you Teegue for your website. Love it. Keep up the great work.

Anonymous said...

If a company is leasing in the Kenmare area, is it more Bakken play that is being looked at? Also, I have seen the name Lonetree on a lease...is that a specific company or a group of "investors"?

EOG reported a dry hole on the one SW of Blaisdell. I hear they have staked one further north of that site. Was the hole dry or did they mess it up? Once they stake....how long before a permit (average)?
Gene

Larry said...

Gene,
Rocky Mountain Oil Journal reported that EOG may have abandoned the McAlmond well because it was a dry hole. The locals say EOG had problems and were moving to a new site. Until the drilling reports are
no longer confidential, only EOG and NDIC knows why they stopped drilling.

It would be difficult to guess the number of days from staking to permitting a well. I would guess that in this situation the time period will be short.

Anonymous said...

Willy, What did the Texas University do for a lease?

Anonymous said...

I have a very small ownership in 160ac plot near Stanley.Can some one tell me how to calculate potential royalties should the stars all line up? Could you do this be done based on an net acre ownership basis. example: net acres owned 29.88 & 1/6% lease agreement.
Thanks

Anonymous said...

Larry, Tee, newbie needs a Math lesson.

The givens:

leased with @ 1/6
oil @$85 per
what are the potential royalties per net acre? How is it calculated with the pooling rules?
(sorry,earlier post was unclear)

david said...

There are two other things you need to know, in particular, what is the spacing on the well and how many barrels the well produces in a month.
On a 640 acre spacing the calculation would be
1/6 x 29.88/640 x production of the well in bbl per month x $85.
This would calculate your gross monthly royalty payment.

Subtracted from your check calculated based on these numbers would be 11.5% for the severance tax.

You may also receive a small royalty if they eventually recover gas, but I think this is generally only about 10% of the crude oil royalty.

Teegue said...

Anon: multiply whatever you think the production will be times the price per barrel times your decimal share of the production, which is 0.00778 for a 640 acre unit and 0.00389 for a 1280 acre unit.