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Williams withdraws application to drill in Double Oak PDF Print E-mail
Friday, 03 September 2010 14:15

Citing a recent decline in natural gas prices, Williams Production withdrew its application Friday for up to 15 wells in Double Oak near FM 407 and Simmons.

In a letter to Double Oak leaseholders, the driller said that "geologic information revealed that our drilling laterals (the length that a drill bit travels horizontally) needed to be shorter than planned due to faults (or breaks) in the natural gas formation near Double Oak. Longer laterals can produce more gas than shorter ones. In a stronger commodity price environment, shorter laterals can still produce attractive returns. However, the price of natural gas has been quickly declining as we’ve gone through the permitting process, making the nature of our project uneconomic at this time."

Williams also announced that it has elected to allow leases to expire as their terms runs out.

On August 16th, despite some public opposition, the Double Oak Planning & Zoning Commission unanimously recommended that the Town Council approve their permit request to enlarge the Meece pad site and place up to 15 wells on the site, which sits just south of Lantana.

The future of the site remains uncertain, as drilling operations had previously taken place on the land by Red Oak Gas Operating Company.

Whatever the case, local citizen groups who were against the project are taking a moment to recognize their efforts in fighting the project.

"What Williams' letter fails to recognize is that there was a significant amount of pressure put on them by grass roots organizations such as Double Oak Cares, Flower Mound Cares, Corinth Cares and others for safer industry practices," said Double Oak resident Will Evans. "And to the credit of our Town Council, they listened to our concerns and insisted on accountability."

 

Comments  

 
+3 #4 2010-09-07 15:04
15 wells, $4 per MCF, 25% royalty. Conservatively, a net present value of at least $40mm that will not be in the pocketbooks of hundreds of Double Oak families.
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-1 #3 2010-09-04 13:23
Actually, Tim, when oil or gas price expectations decline sufficiently, producers do scale back production. That's true for any commodity.
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+6 #2 2010-09-03 22:42
On Tuesday, The Town Council will consider a moretoreum on all permitte associated with Gas Exploration and associated activities.

Tracy
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+3 #1 2010-09-03 21:34
I think what will be very telling is where Williams decides to set up shop next. That will speak to their comment about the price of natural gas. Do the other energy companies stop drilling for oil when the price of a barrel drops? Not any more than the gas companies stop drilling for gas, short laterals or otherwise. Time will tell. Keep up the fight, Double Oak, you're not done yet!
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