The fourth well was completed and drilled to 785 ft with production potential.  Well #4 is currently choked back for various reasons to about 15-25 barrels per day till more is known and recovery tanks are in place.  Initial disturbance caused sand and water to mix in the fault area, so amount and quality is a bit diminished till strata zone settles down and cleans itself up.  They are pushing pipe into identified fault zone traps in the Steinle-Nixon strata similar to what was done decades ago that yielded a lot of production over time.  As this well is so new, there are no real details on production, so can’t compare past and present yet. 

Mobil sank a lot of pipe drilling wells, and had a lot of marginal and failed wells in the process looking for all those sweet spots when they had free reign and drilling was cheap.  So I’m not counting on any missed gushers Mobil missed back then.  Well #4 is between two former Mobil wells in the area.  These Pressly wells are tapping into individual fault zones that have water, sand, oil and some amount of gas hydrocarbons trapped in an upside down V.  They are putting a straw into the topmost to pull oil that is floating on the water and under pressure for now while avoiding the water.  The pressure later diminishes, a pumpjack is installed along with a battery of storage tanks so it can be trucked out.

Estimated potential is a guess, unknown for now.  The well is likely to stay that way as there are no seismology charts other than the old seismic charts he has from the 50-60’s, and no measurable stats are currently available.  These are wildcat wells in the shallow Nixon-Steinle strata that has many individual fault zones that could pay or play out after a limited amount of production.  The past high production amounts he quotes are from a large area known as the Nixon-Steinle basin area and strata which covers the southern portion of the ranch and northern part of Steinle ranch over to La Parita Road that produced several hundred thousand barrels.  The geologic reason is that strata area butts up against a very deep, major fault line that runs along the top ridge of the ranch, so the minerals were trapped or pooled in these various faults zones.  These new wells are being drilled in the far western basin area of those older wells on Steinle and the ranch.  Naturally he hopes and thinks it could yield similar stats.  This has only fueled his desire to lease up to 50 acres more and tap 4-6 more spots in the current lease in hopes they might find a fault zone high potential well.  He is also trying to lock up this acreage to prevent someone else from coming in and offering a lease on it.

At this point they are 1 for 4 in wells drilled and completed.  Well 1 is to be capped and abandoned as a non-producing well.  Wells 2 and 3 are slated for abandonment unless we take up his offer to plug and tap #2 for a shallow water well, and using gas from #3 for a small natural gas powered generator from it.  In any event these wells are slated to be plugged and buried if we do not request that another use is made of them, and pony up the $$ for the equipment and whatever else like pipe, valves, etc.  The #2 well was a bust, and at 150-200 ft or so could be converted to a water well, although the water quality is unknown till further testing.  The amount of gas, usability, and how long the pressure in #3 would last is also unknown.  Once the pressure is gone, no more gas, so quite likely there is a limited quantity unless further testing shows favorable pressure results.  The recoverable amount is not feasible for salable gas production, especially without a pipeline, separator and collection system.

The realistic downside is the past production history is based on many wells from a similar strata from a new virgin untapped field that yielded a lot of production between the 40’s to 60’s.  They had the choice and cherry picked the larger and more viable fault zone seismic spots.  However, the oil production from the entire ranch also produced a tremendous amount of salt water back then from these shallow wells, and the several 7,000 ft oil and/or gas wells.  Traditional salt water disposal back then was an evaporation tank on the ranch.  Later phased out due to statewide salt pit accidents spilling salt water into creeks or streams brought new regulations prohibiting salt water evaporation pits.

Although it was covered over, buried, dirt removed or whatever was done back in the late 60’s under less stringent RRC and EPA rules on pollution to close it.  There appears to be a whitish mineral leaching out of the ground below where tank was.  If it’s salt, could threaten the big tank in runoff.  I would like to have some soil testing done to verify what might be leaching out to protect big tank in the runoff downstream from it.  If it’s salt, then we would need to explore remedies or options.  It has been many decades since it was “cleaned” up in any event.

I mentioned to David Pressly my concern of the roads and residual damage to the acreage around the area they have drilled.  I proposed to David we get all the facts and details together about the existing lease and wells and have a sit down meeting to discuss what’s next.  Not willing to sign off any more acreage for a second lease or expansion of the first lease till #4 well provides a better picture of viability.  I’m not opposed to oil companies, just the residual topsoil damage, trash, neglect, and impact on the roads which are already in need of some help soon.  Primary concern is the roads and the additional truck traffic needed to haul the oil out.  Donut Tank Rd is like a raging river in a heavy rain, and the lack of erosion control from downtrodden spreader dams is worsening.

The fact that we were in the clear with no more oil trash and wells after Eagle Rock cleaned up the previous wells, metal, pipes, and so forth, but now it’s back.  Said that I have road issues with Virtex on the Pearl section.  However, on my last trip down, Virtex seems to have moved most of the gas compressor equipment from their adjoining Pearl tract that was there.  It’s vacant for the most part now.  They have done major workovers on all the existing wells.  Unsure why they removed the loud noisy compressor that feeds the area gas into the Coastal pipeline.