Roby, Texas—Someone give this thing a name. What “thing”? Well, the “thing” is whatever is going on in Fisher County. And, apparently, Mitchell County, Scurry County, maybe Nolan County—places where the words “shale play” are not part of the local vernacular.
And why has this unfolded so quietly? Normally, news reaches media outlets—and this PBPA membership magazine counts as a media outlet—by conventional channels such as news releases, press conferences, official pronouncements, and the like.
This one has been surreptitious. And sources have been tight-lipped, but maybe that is to be expected where new energy finds are concerned.
Word first reached us from someone who works in this office, saying simply that he’d heard there is a lot of leasing activity in Fisher County, which has not been an area that has been associated with the oil or gas plays of recent times. The leases had climbed into the $300 range, maybe higher, per acre.
Our first calls to that area did not turn up any better information. Then this editor got a call from his sister-in-law, of all people, who’d recently signed a lease in the Merkel area, just west of Abilene. That area, she said, is reputed to be the far southeastern fringe of the heightened activity. No $300 deal there—nothing close to it—but at least there was a flicker of activity in those parts.
Then we learned, from another source in Merkel, that the shale bed in question had always been known—it just hadn’t been deemed feasible, at least not in pre-horizontal-drilling days. “It is a thin bed,” this source said, “at least in places. And in decades past no one thought it was an adequate pay zone.”
Well, possibly that has changed. At any rate, armed with that information, or lack thereof, I set out to Fisher County on March 19 to see what I could learn.
Thinly populated Fisher County, whose southern border lies a few miles above I-20, in the region north of Sweetwater, has not been known for much more than agriculture. Its two largest towns, Roby and Rotan, are its only towns. And neither is much more than a one-traffic-light town.
On this Monday, the county courthouse in Roby is hemmed with vehicles. Inside, I’m told it’s a “slow day.” Most of these landmen come here from farflung locations, so they use Monday as a travel day.
One landman tells me that on “normal” weekdays, some 30 to 60 landmen are here doing research. Himself, he’s been here “five or six weeks.”
I asked him what the name was for this shale play. He replied, “I asked my client what formation he was after, but I never got an answer.”
The same comes from others—they’ve not heard what this play is called.
Another source who also did not want to be named said that hardly any drilling has happened here yet. The activity has been almost entirely leasing.
Next door, Pat Thomson, County Clerk for Fisher County, works amidst a constant traffic of people through her offices. Thomson can be more definitive, and she is.
“We’ve been fairly busy since October of 2011 with leasing,” she says, and she confirms the 30-to-60-landmen-a-day estimate. “What’s happening here is research,” she says. “They go elsewhere to do the leasing. And then [later] we do the filing. We had 273 oil and gas leases last month. Which is a lot for us.”
How does that compare with their norm?
“We don’t really have a ‘norm,’” Thomson said, citing the fact that this is all so new to them. There was some leasing activity as far back as a year ago, but nothing like what they are seeing now.
The leases are largely concentrated on the northwest part of the county, north and west of Rotan.
“But things started off in the southwest,” she said. “And I’ve had some guys in here who said they were also working in Scurry County and then they even went up to Kent County to do some work. And someone said they thought there was going to be some leasing on the Jones County line, which is east of here.”
From here it’s off to the Big Country Electric Cooperative office, a few blocks away, where I learn from Dalvin Alexander, Electrical System Manager, that two of the county’s electrical substations are scheduled for upgrades.
Is that to accommodate greater demand brought on by anticipated oil and gas development? Alexander said he can’t confirm that. But he said that word had reached him that 29 drilling rigs are on the way to the Snyder area within the next 60 days, and he considers this part of the world to be part of the “Snyder area.”
Fredda Buckner, manager of this cooperative, confirmed Alexander’s figure of 29 rigs. Buckner said she had heard that a well had been drilled a few miles east of Rotan. Lease prices have been climbing, she said. A year ago, the high prices were around $200. Now some are above $350.
Next stop: Rotan, ten miles north. Stepping out the front door of Big Country Electric, one is greeted by a panoramic sweep of prairie, with a horizon dominated, some 15-20 miles north, by the Double Mountains. A wind farm is slated for construction to the southwest of the two rocky heights—this much confirmed by the electrical coop.
Fisher County was ravaged by one of Texas’ worst wildfires a year ago, and the tale of that fire is told by the landscape between Roby and Rotan. Halfway there, one sees Fisher County Hospital, which had to be evacuated to keep staff and patients safe.
In Rotan, at Allsup’s convenience store, I learned that there are oil and gas workers in town, staying at the motel. At the Dairy Queen, one local remarked that, yes, a well had been drilled east of town, and three or four others had been staked.
“It’s all about to bust loose in the next 60 days,” he said.
Heading east on 92, it’s bluebonnets and tumbleweeds just outside Rotan. Off to the north are those Double Mountains, which I’d learned were landmarks for the early buffalo hunters. Sammy Baugh—for those football fans reading this—had his ranch near those mountains, and though Baugh died a couple of years ago, his son still runs that operation.
A short drive confirms the just-completed well. The derrick’s gone, but a pumping unit is active, less than two weeks old. Out by the wellsite I hailed down a pickup driving by—driven by Jeremy Presley, who is out here constructing roads. He points to where another well was completed and others are to start.
Has he heard a name given for this shale play? No. He has an idea, but it’s nothing he can confirm. But Presley did allow that there are frac trucks working in the area now.
That, apparently, is part of what occupies him out in these parts, with road building.
“I’ve got 100 more coming,” he said. “They’ll be here in a month.”
It’s late in the day, and nothing more to learn here. It would be nice to know what this shale play is called, but it’s likely a reader will tell us that within the month.
Meanwhile, the Double Mountains bask golden in the dying light. Landmark in the Indian Wars, witness to buffalo migrations for centuries, witness to the disappearance of the same and to settlement and even to wildfires in our own time, those hills stand over another swift change in a big country.
FORMATION NORTHWEST OF ABILENE DRAWS ATTENTION OF OIL EXPLORATION COMPANIES
By Jaime Adame Published Tuesday, January 17, 2012
With interest in oil and gas production rising along with the price of oil, the industry is turning an eye to a rock formation northwest of Abilene, local experts said.
In the Abilene region, “the biggest thing is a leasing play occurring in northern Fisher County and western Nolan County and Mitchell and Scurry counties for a potential shale that may be oil and gas productive,” said Allan Frizzell, a district vice president for the Texas Oil & Gas Association and vice president of Abilene-based Enrich Oil Corp.
Such a “leasing play” is a rush to acquire mineral rights from landowners.
“It’s pretty speculative, but the lease bonus money being paid to mineral owners is pretty high and is injecting a lot of revenue into local banks,” said Frizzell, explaining that “it’s in its infancy, as far as the drilling and completion phase.”
Mark McKeehan, past-president of the Abilene Geological Society, said about the geologic formation that “everybody’s known it shows oil and gas for long time.”
But now producers have the ability to use techniques such as hydraulic fracturing, commonplace in exploring rock formations such as the Barnett Shale and Eagle Ford Shale in Texas.
In the area northwest of Abilene, “the technology’s catching up with it: the ability to go in there and ‘frac’ the thing and open it up has caused it to be a potential moneymaker for the people in that area,” said McKeehan.
Such fracking techniques have come under fire from environmental critics who have complained about potential contamination of groundwater from fracking or waste produced by the fracking process, with the Environmental Protection Agency studying any potential harmful effects.
Frizzell emphasized the depth of the formation.
“It’s very deep. It ranges from 5,000 to 7,000 feet deep, so it’ll be safe. Groundwater resources will be very safe,” Frizzell said.
McKeehan said landowners in the region “are benefiting tremendously from this.”
“I’m not sure exactly what the monetary interest is that the landowners are receiving, but I know they’re getting a premium for the land right now,” he added.
Exploration companies aggressively pursue such deals before drilling to bolster their stake in whatever may be produced by the formation, McKeehan said.
The next step won’t be cheap for exploration companies, McKeehan said.
“The wells will be expensive to drill. They’ll be horizontal, and they’ll have to put a big frac treatment on it, so they’re going to be expensive,” McKeehan said.
The formation is not as big or as thick as other Texas formations, McKeehan said, calling it “much smaller” than the Barnett Shale region in the Fort Worth area.
Frizzell said other production areas getting a boost include the region near Throckmorton, with horizontal drilling techniques being used in some cases.
He said a spike in drilling in the Permian Basin region has benefitted many Abilene businesses.
“In the Abilene area, the service companies seem to be keeping up with the activity there, such as the trucking and well logging and well servicing and supply stores, seem to be keeping up with the demand,” Frizzell said, adding that the spike in sales tax revenue is likely related to rising revenues from oil and gas activity.
As for the formation northwest of Abilene, Frizzell said he thinks drilling will start this year. McKeehan said he expects drilling to start within six months, with no guarantees of a quick success.
“I’m sure there’ll be a lot of a learning curve involved, and some techniques will work and some won’t,” McKeehan said. “It’s going to be kind of a work in progress.”
McKeehan said the formation “has all the right characteristics … like the shales” in the Permian Basin.
Until drilling begins, however, “the jury’s still out on it out right now,” McKeehan said.
By Jesse Mullins
Category: Cline Shale