Can A Spacing Unit Be Held By Production Even If the Well Is No Longer Producing?

That was the question that was just asked of me.

I don't own any mineral rights, and I don't follow the issue that closely.

The folks over on the Bakken Shale Discussion Group might be able to help. The site is linked at the sidebar at the right.

Having said that, it appears that until a well is permanently abandoned, the well would hold the lease by production even if it was not producing. I have seen many examples of a well still listed as active even though it last produced oil two or three years earlier. Many of these wells were producing a fair amount of oil when all of a sudden, the pump was turned off, and oil was no longer flowing or being brought to the surface.

It is obvious that when the well was last pumping, there was still oil there, and if necessary, the operator could start the pump up again.

I have seen wells go for months, maybe even a year, without production and then all of a sudden start producing again.

Again, I do not know the "real" answer but my hunch is that until the well is permanently abandoned, the lease is held by production.

By the way,  I think readers understand the underlying reason for the question that was being asked. My answer to that: if it made financial sense to drill a new well into a spacing unit held by production, I believe a top lease would be arranged. Again, I am out of my depth in these areas, but based on discussions I have followed elsewhere, this sounds plausible.