Vertical oil well owners gain knowledge on an increasingly horizontal well-driven market
Drew Butler | The Daily Ardmoreite
On Friday, the Oklahoma Energy Producers Alliance put together a free luncheon to help vertical well owners protect their interests when damaged by horizontal wells. After lunch was served a panel discussion took place with lawyers and engineers providing their expertise and advice.
“The horizontal universe began 10 to 15 years ago and we’ve all been playing catch up to the reality of these very successful wells,” OEPA Chairman Dewey Bartlett said. “Unfortunately, it has been to the detriment of our friends, neighbors, and companies. Our livelihoods depend on our companies being vital. They also depend on our companies not being taken advantage of by those with very expensive lawyers and a regulatory environment that has yet to react to the reality of the horizontal universe.”
The primary advice was to always be proactive when dealing with any horizontal drilling that will be taking place near a vertical well you either own or operate. The panel agreed taking this step prevents potentially prolonged and costly legal activity.
“Try to be proactive and deal with the horizontal driller,” said panel member Jim Marshall. “They don’t want to damage your well, but I think everyone would like to have this negotiated beforehand rather than after the fact.”
Panel member Andrew Jackson provided some sample letters to send out to horizontal drillers when a vertical well owner receives notice of a horizontal completion to be installed near their well. These letters put the operator on notice of your interest.
“Part of that is how to prepare for the offset frack, what kind of cost you expect to recover, and how to keep you notified if something does happen.” He recommends sending out a certified letter to guarantee the recipient knows what your expectations are.
OEPA Regulatory Affairs Chairman Tom Dunlap closed the meeting by pointing out the situation wasn’t entirely negative.
“We’re there with the industry, it’s going to go forward, and we’re a part of it,” Dunlap said. “The horizontal drilling and the fracking for that drilling is good. We get more recovery so there is a major positive. Look what’s going on nationally and internationally. The country is doing well with all of this new stuff. We just have to think proactive on how to make this work. Just know what you’ve got and how to play your cards.”