Question My siblings and I own the mineral rights on some property in the Bakken in North Dakota. We leased the rights to a company well over three years ago with their "intent to drill". They finally took out three permits and the status was "confidential". These went off of the "confidential" status in December and January and now are listed as "tight hole" status. I am wondering what this means. I am wondering how long it will take before we will be able to get any information. I also wonder is all companies operate like this. I did contact one of the company reps and he said I would have to check on the public ND Mineral site to follow the progress. He did say they are drilling three wells. We are now thinking if we had leased to someone else it may not have taken three and a half years.
Answer The "confidential" status is common in ND, so unfortunately unless you are a working-interest owner (i.e. helped pay or contributed leasehold to the well) then you will probably have to wait until the well is off confidential status or until you receive your first check to see how the well is doing. I would suggest calling the operator though, and asking them if the well is at least "producing." They may tell you that minimal amount of info even if it's still a "tight hole." One other way would be to actually visit the well site and read the gas meter or watch for oil trucks picking up oil from the lease, which obviously would indicate production.
Keep in mind also that when you lease your minerals for three years, the lessee actually has three years to even begin drilling, and there is no obligation for them to even do that. The lease just gives them the "exclusive right" to drill during the primary term so there are never any guarantees that a well will even be drilled (except in rare cases where the mineral owner has required it in the lease.)
Hope this helps you out.
Frederick M. "Mick" Scott CMM RPL
www.mineralhub.com The Mineral Hub
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Thank you for the speedy and informative reply. It was very helpful.
Oil and gas leasing, lease negotiations, how to best deal with the oil and gas companies or their representatives, buying/selling mineral rights, forced-pooling, correlative rights, deeds and conveyances, and "post-production" costs. I am most experienced with Oklahoma properties and laws, but am able to answer questions concerning other oil and gas producing states in many cases.
I am a Certified Professional Mineral Manager (CMM) certified by the National Association of Royalty Owners (NARO) in Tulsa, OK. I am also a Registered Professional Landman (RPL) with the American Association of Professional Landmen (AAPL). I have managed my family's oil and gas properties in Oklahoma for over 10 years and have dealt with many landmen, title analysts, attorneys and other oil and gas professionals in the process. I have written articles of interest to mineral rights owners which have appeared in various industry magazines and newsletters. I have negotiated and drafted leases, prepared deeds, affidavits, and other legal instruments relating to my own minerals, as well as performed title, legal research, and curative work for same. I have acquired a good deal of knowledge on the subjects of oil and gas law, mineral appraisal, and land and title work over the past ten years, and have also worked as a professional landman. I've seen the business from "both sides" and therefore feel confident I can help out most of the folks who ask questions in this forum.
Publications National Association of Royalty Owners "Action Report" (ROAR); NADOA Magazine, The Mineral Hub, Landman Magazine, and several royalty owner association group's newsletters.
Education/Credentials Certified Mineral Manager (CMM), Registered Professional Landman (RPL)