For many operators, their limited drilling budgets are focused on holding their top priority leases that are due to expire (where it makes economic sense, of course). Drilling departments across the industry will tell you, “We’re in lease-maintenance mode”.

Operators’ land assets are based on the leases they hold. For several reasons, a lease can expire with the government unless the operator can show development activity. The operator foregoes the money they paid for the lease, and the land/mineral rights go back on the market.

For many of these leases the economics are no longer viable, best to call it a sunk cost and let the lease expire. On the other hand, there are several situations where drilling does make sense: in plays where the economics add up at current prices or help contribute to operators’ longer-term strategies.

By no means are these a ‘crystal ball’ for drilling projections, but we’ll let you draw your own conclusions based on some of these interesting stats.

Use XI’s AssetBook to do further research on these operators, these areas, and everything in between. Then, where there IS likelihood to drill, use XI’s Offset Analyst for cost-estimating, risk/hazard assessment, well planning, and performance benchmarking.

leases expiring(2)

Top Operators with Expiring Leases

Clearing plate + Heavily invested

Top Fields with Expiring Leases

hottest areas + back on + big money(2)