Even more wells

Previous - Slide 21 - Next

Now that Mr. Northwest and Mr. Northeast know there is a pool of gas in their mineral tracts, they decide to drill more wells in order to get the gas out from the rest of their share of the 400-acre pool of gas.

They do not want their next wells to steal from their own existing wells (#3, #4, and #5) which they have already drilled.  So they drill their next wells ( #6, #7, #8, and #9) “spaced” far enough away that the 100 acres each of the new wells drains will not drain from the 100 acres their existing wells drain.

So we now have 9 wells draining what 4 could drain, getting less total gas out, all against the interest of all of the players, as explained before

And note that a real world the pool of gas in a stratigraphic trap will be larger than 400 acres.  That being the case, well #6 is draining out from under the next mineral owner to the west.  So the owner to the west may drill an “offset” well.  On the other hand, wells #7 and #8 may not be draining out from under neighbors, but the neighbors now know that there is a pool of gas extending onto their mineral tract.  So they are free to drill wells on an edge of their mineral tracts just outside our 400-acre blue circle and try to legally steal the gas out from under Mr. Northwest and Mr. Northeast.

And the effects ripple outward.

Go directly to intro or slide: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 24a 25 26 27 28 29 30 31 32 33