Montana oil and mining journal. [volume] (Great Falls, Mont.) 1931-1953, 1940-08-31

IL is our great heritage TO be able 10
buy royalty covering this potential deep
production on the basis of values now es-
tablished In the upper horizons which
have thus far yielded royalty owners
$4,000. 900. Those who have done so
and those who do so before the first
deep producer is drilled. will certainly
profit most
One OF the biologists who preached
Devonian possibilities in Illinois was
Dorsey Hager, petroleum geologist and
author of many books. Hager was. one
of four friendly advisers in the early
history OF Kelvin field. Until this day
we have never quoted him. He gave us
this guidance without charge-merely
as a friend In the early days of Kelvin
field we had no basis of judging the
value of royalties. Cat Greek values
were out of line with Kelvin values go
we had no measuring stick" 1t was
Dorsey Hager who gave us a maximum
figure He told us to figure an average
recovery of five thousand dollars-not
barrels-per acre, with the admontion
that we should never accept odds of less
than $40 for each 81 invested. That is,
in no instance should we pay more than
IS per cent per acre for royalty. We
followed that rule with only occasional
exceptions-an it was on that rule that
any success our members have achieved
is based. We based our risk on a re-
covery of $500 per acre (maxi-
mum) whereas the average developed
acre in Kelvin field has. according to
Officials state figures produced around
81 800.
In that regard we were led this week
to glance back over some early records
mr. va in
containing estimates of reserves in Kelvin
Sunburst field which are doubly inter
esting at this time.
At the New York meeting of the
American Association of Petroleum
Biologists in February, 1928 the year
after the discovery of oil in Kevin-Sun-
burst field, Dorsey Hager, Independent
petroleum geologist, read paper on the
field, giving its brief history and dis
GUESSING the future possibilities.
OF particular interest is one part of
the paper in which he discussed probable
recovery. In view of the fact that rela-
lively few wells had been drilled it is
interesting to check the accuracy of his
conclusions by results to date His
statement follows:
From present operations, it is
difficult to say what the wells should
produce. Wells in the Kootenai hori-
zon, with a body of sand Is to 20 it.
thick, should produce at least 1000
Dbl. per acre, or $4,000 Dbl. per well,
with one well to each 8 acres. This
estimate is conservative.
6tT4 :; bo.J - oe+;~oo4o +bo ,,rod,,o
ton for wells in the Ellis horizon,
like the Gladys Belle, Mid-Northern
and Hogan, which started at 200 to
$50 Dbl. each. The oil horizon is
from to 20 feet thick Such wells
should produce not less than 10000
Dbl. the first year and be good for
10000 Dbl. for their first ten years
of life. This means 5000 Dbl. per acre,
where one well is drilled per acres,
which will be good practice.
"These estimates are largely as
sumptive, especially as only one wen
has produced over months. That
well, the Sunburst discovery well,
produced initially 100 bbl per day
and is now producing As Dbl. per day
from the Kootenai sand. The Gladys
Belle No. l has produced for 60 days
from the Ellis sand and produces IS
Dbl. at present. The Mid-Northern
well has produced over 225 Dbl. per
day for As days and shows no di-
minuation in output. After 35 days,
the Hogan well is producing $50 Dbl,
which was its initial flow. These wells
have not been affected by offsets and
so do not give true index of con-
ditions.
"The results of drilling and the ge-
illogical evidence lead to the belief that
full township of oil-producing land
has been fairly well blocked out in
the northern end of the field. A town
ship comprises 23,04O acres; with 8
acres per well; this means room for
1880 wells. If these wells average
10000 Dbl. apiece, there are S6,400,-
600 Dbl of recoverable oil.