Yes We Can Become Energy Independent
Converse County Update
Chesapeake Energy Announces Plans
for our Client’s Leases
Dateline: Converse County WY – March 2009
You may recall that last year was a banner year for Wes State Clients. During 2008 over 400 Wes State customers has their oil and gas lease rights sell to oil companies, large and small, for potential exploration and development. Of all of our client’s lease sales to oil companies last year, there’s one stands head and shoulders above the rest. Those were the leases that were sold in Converse County, WY to Chesapeake Exploration. You may recall that Chesapeake bought several leases from our clients expressing to them, a strong likelihood of development.
Well things are certainly looking very favorable to that end. We just received news that Chesapeake Exploration is moving forward with their plans to unitize a rather large area in Converse County and are we’re overjoyed that several of our client’s leases are smack dab in the middle (so to speak).
Unitization is a process whereby several parcels are brought together into a “unit”. One of the primary purposes of a unit is to provide for leases that now become perpetual, meaning they are no longer subject to expiration at the end of the lease term, so long as certain criteria are met. This allows the oil company to select strategic drill sites – within the unit – and begin drilling. What can eventually happen is that no matter where in the unit Chesapeake decides to drill, other members of the unit could participate. Although making a determination on that is a little premature at this point.
The main consideration is that with the unitization of these parcels, being called the Spillman Draw (deep) Unit Area, steps are now in place to begin an aggressive drilling campaign. Hopefully that will take place very soon. The unit is comprised of 16,268 acres of Federal Lands, 1,350 acres of state lands and the remainder to total over 25,000 acres that comprise the unit, are patented lands. It is very exciting indeed.
If you care to look it up on a map, Converse County is located in the middle part of Wyoming, in the area of Casper, as shown on the county map below. The subject leases are in and around Township 34 & 35 North and Range 72 & 73 West. This is a productive region of the state, known for both oil and gas. Let’s certainly pray for a successful outcome for all parties involved including our clients and Chesapeake Exploration who have invested, no doubt, millions of dollars in making this project a reality.
With the harshness of winter now behind us, not to mention the rather cold economy we’ve all experienced over the past several months, things appear on the move again. The stock market – as of this writing – has been steadily up over recent weeks. That’s a switch, for sure. Closer to home, Westar Minerals has just purchased 640 acres in Wyoming and we have some strong interest in several other leases held by our customers. Westar has been an aggressive buyer for lease parcels our clients own. Last year (2008) they purchased literally thousands of acres of our leases in Colorado and Utah. Westar’s purchases always include the customary up-front cash bonus drilling fee along with a nice overriding royalty on any and all future oil or gas production.
We’ve also received news that Geyser Petroleum, a smaller independent driller in Colorado, was about to begin drilling one of three leases that they purchased from our clients. In checking in again with Geyser we understand that a drilling rig is now on-site and that we should hear something (hopefully something good) very soon.
Meanwhile more and more good news as our list of winners and those
who acquire oil and gas leases in both the government sponsored public
auctions and lottery drawings continues to grow. With hopefully the
worst of the economic slowdown behind us we’ll begin to see stepped
up drilling and development in the months ahead. This will be very good
news for everyone.