Oilfield clean up guys....I have a Question

[MAP]

I was just curious if anybody on this site does any work or has any experience cleaning up old oilfield well locations and/or resent drilling sites. An oilfield company out of Houston recently drilled an oil well in one of our pastures. The investors decided to stop drilling and cap the well with out any production being found. They have moved all the equipment and where ready to fill in the 3 large pits that they dug next to the well. Just out of curiousity I asked if there was any way I could fill in the holes and they pay me unstead of subcontracting the job out to another company. The head guy on the site said they actually prefer when the landowner does this rather then finding somebody else to do the job. So here is my question. What would the average company charge to do this type of work? Also, one of the pits is full of mud and the oil company said it must be "covered and filled right" because of state environmental laws. How would a person go about filling a hole like this, and/or would the mud have to be removed?

The company offered us $4,000 in damages and another $9,000 to actually do the job and fill in the holes. What I was thinking about doing is hiring a bull dozer operator that has experience in this line of work to come out and fill them in, pay them and still have a profit. Plus the company also said due to state law, the pipe must be cut off atleast 4 feet under ground.

Is there anybody who has any experience who can answer my questions and help me understand the process alittle better? Thanks for the time.......

[Bucks&Broadheads]

Just curious...How much did the Oil company end up paying you overall for damages and what not, other than the $4,000 and $9,000. Also, how badly did they tear up your property overall and did you have any say so in where the drilled? The reason I ask is that I don't own any mineral rights on my property and wells are popping up all around me right now, so I was just wondering what to expect if/when they come knocking.

[MAP]

Bucks,

We havent actually agreed to any amount yet, this is an offer that was handed to us just the other day. If we agree then $4,000 is the total amount that we would recieve for damages, but this figure is also just a number that the company threw out. It never hurts to ask for a little more, and some times when you deny their first offer you will be amazed at how much their second offer increases (but not always). Honestly they didnt tear up the place very much. The well is located in a 800 acre farm field and was drilled in a time when there was no crops planted. They tried their best to stay off the site when it was muddy and any ruts they made, they fixed. The entire well location and half way decent pad they made, takes up a few acres and they also laid a semi-decent caliche road that is about 1/4 mile long.

If you the largest percentage of mineral rights then you do have some say as to where they drill. But that is only done when you lease them out the land. You can decide which pastures they can lease and/or acreage they can have, but they can drill anywhere they want inside of that lease agreement boundary line.

As far as not owning any mineral rights, I would say that your not going to have much pull with the oil company. I'm sure somebody else knows ALOT more about this issue then I do, and might chime in later. But since you dont own mineral rights, but you own surface rights, then your only entitled to and only have say when it comes to damages done to the ranch.

[TSpradlin]

We dont deal in clean up but I called a friend of mine who does and he said that you need to make sure what was put in the sludge pit. If there were any chems. you might have to hire some one that is lic. to do the job.

[Bill M]

Bucks if you have any surface leases on your property by other folks they can basically come in when and where they want. Surface leases kept us from buying a beautiful piece of property in Robertson County last year.

[Longhorn]

Map, I'm not sure what they would pay a company to fill a pit. I can only tell you from my own experience that they might want you to sign some type of release, putting the liablity in your hands. I was told a story by an old landman in which they had drilled on the side of a hill and the pit started filling up with water in a rainstorm. They had a pretty good idea what might happen, so they made sure to get a release and filed it in the County Records. Then the dam blew out and mud went down into the neighbors pasture. I'm not sure who ended up paying damages to the neighbors place. Also be aware of anything else that maybe in that pit besides water and mud that would create an enviromental issues. I have seem stuff in pits before that I didn't think was bueno. Just my humble thoughts form my time as a landman.

Bucks&Broadheads, I work around Jewett right now. Where is your spread?

[Longhorn]

A few more thoughts on this topic: If you are a mineral owner/surface owner it is best to make sure you have some kind of damage clause in your lease. This can be as vague or specific as you want. If you are a non mineral owner, you are pretty much SOL as far as stopping someone from drilling on your place. This is Texas and the Mineral Estate is dominant. Remember that back in the day as long as an oil company acted as a prudent operator they didn’t have to pay a surface owner any damages. Today Oil companies pay damages, mostly because it is easier to get a release then worry about any kind of attempted legal action. Always remember though that if they really wanted to push the issue they could try to get away with not paying anything at all. Having an oil company on your place isn't exactly always bad. Some of the things I have seen surface owners benefit from in the past include, new fence, new gates, cattle guards, brush clearing, and new roads/ repairs to existing roads.

[stang_j_99]

You will prolly have to have a vacumn truck come in and hual of the crap. I been told u can spread it in ur pasture, but u have to disc it in. Look up Chucks Oilfield Srvs. if your around robertson county. Tell him Ricky from Northfeild told you to give him a call. He could prolly piont you in the right direction.

[Jamie]

In my opinion...your trading a short term monetary gain for a longterm headache.

If you ever sell your land and they do a level II environmental study, you might have to disclose the wellsite. If some contamnation is found, it might be your nickel that is used to pay for it....versus going back to the drilling co. and forcing them to do it.

I'd still ask for damages, though that should have been in the mineral lease, but let the drilling co. do the actual cleanup.

[Bucks&Broadheads]

Bucks&Broadheads, I work around Jewett right now. Where is your spread?

I have about 200 acres just outside of Marquez. I wasn't too worried about the mineral rights untill my friend informed me that wells were popping up all around me. I know the lady that owns all the mineral rights and think she might sell some to me. I don't know if I want to buy some or not. My dad thinks it's not that big a deal to own them because the settlements are usualy very fair. I was also told that if you own at least 1/8 of the mineral rights you would have say so as to where they drilled and where they came in your property. Is this true? Either way, an 1/8 of the rights would probably cost me over $30,000 so I'm just not sure if its worth it. Any suggestions would be appreciated.

[Longhorn]

Just my opinion,
If I own any of the mineral rights on a tract the oil company is interested in leasing they are going to want to lease them from me. In my lease I can add additional clauses that would become an Exhibit added on at the end of the lease. Surface damages or a no drilling clause would be something that would go in an additional Exhibit. Now if I only owned 1% of the mineral rights the company might be willing to make me a working interest partner and go ahead and drill with out a lease. But if I own 12.5% of the minerals they might think twice about drilling with out a lease. If I decided not to lease I loose any bonus, but I stand to make a larger portion of the payout based on what percentage of the unit I own. Assuming they still drill on or include my tract in the unit. l find it hard to believe they would want to drill on a tract that has 12.5 % outstanding, probably would be more likely to move over to the next tract, and cut that tract out of the unit. As far as if it is worth the investment it is hard to say. Before I bought mineral rights I would have to know previous production history or have seen some kinda of geology in the area. I allso have to realize that just because a well is producing good a quarter mile away does not mean the same formation would produce as well under my tract because of a number of factors. But, that is just how I would think about it.