Idle Rambling -- March 10, 2019

I just received a very, very long note from a reader regarding his family's mineral in North Dakota. I wish I could re-print it in full but it's of a personal nature that the reader may not want published as is.

But some takeaways.

His experience is unlikely to be much different than many in North Dakota who have inherited minerals.

Some data points:

• the reader's grandparents emigrated from eastern Europe in the early 1900's (as did my paternal grandparents; but they decided to settle where there was no oil, in/near Newell, SD -- and so it goes)
• point of arrival in the New World: Quebec; subsequently to North Dakota
• the family sold the farm land some years ago but kept the minerals
• at the time, not sure whether it was best option to keep the minerals
• in 1982 the land was valued at $200/acre and the minerals were valued at $300/acre
• by 1987, the minerals couldn't attract a lease 
• last week the family turned down $6,000/acre for minerals held by production with eight more wells being drilled, and double that number currently producing (16 wells producing)
• the mineral rights are now in a trust for their heirs

Comment:

• I've heard that from a number of folks -- that they are receiving offers of $5,000+/acre; some of this in Tier 2, maybe Tier 3 areas of the Bakken. This tells me the oilmen know a lot more about the potential of even "less-desirable" areas in the Bakken than we're being told
• when I first started the blog, oil companies were putting one well in each 640-acre or 1280-acre drilling unit (one well per section or one well per two sections; the "word on the street" was that was all the wells that would be drilled); in retrospect, they were drilling as fast as they could to hold leases by production; and to get those leases before mineral owners knew how much they might really be worth
• I think it was the Mark Olson wells northwest of Williston that I first noted that there were going to be many, many more wells drilled per drilling unit
• I vividly recall, early in the boom, maybe 2009 or thereabouts, writing that if you had one well on your property, some day you would have four for sure, maybe eight, possible 12, and maybe even way more than that
• I under-estimated how many wells they would put on each drilling unit and we're still not close to where we may finally end up
• those older 16 wells noted above will probably be re-fracked many times over the next 30 years
• the newer wells being drilled are likely to be many times better than the original wells
• I'll bet the reader counts his blessings every day, doesn't take anything for granted
• the mineral money has probably changed his material worth, but his values are probably unchanged, and except for more traveling, has not changed much in outward appearances; he may have a new car

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From Twitter Overnight

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J Is For Jaguar

This was the third word she learned to spell. Maybe her fourth. The first two words: her first and last name.

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San Bernardino

When I moved out to California after leaving the Dakotas in 1977 I roomed with a wonderful, wonderful person (also named Bruce, by the way) who came from San Bernardino. He was perhaps the most honest, hardest-working, smartest, humblest person I've ever met. I was incredibly fortunate to have met him.

San Bernardino, Christie

 

Padre Dumetz named the area "San Bernardino" after Saint Bernardino of Siena, the patron saint of the day on the Catholic Calendar. In 1819, Mission San Gabriel established Rancho San Bernardino in the area.