Belfield wells must produce by Nov. 1; Mineral rights owners complained Denver company was sitting on oil and money
A Denver oil company will have until November to bring three wells near Belfield back into production after mineral rights owners said the company was letting the oil and money sit in the ground, North Dakota Industrial Commission members decided Monday in Bismarck.
"We will give them time to show us that they are trying to develop this unit, but they need to show this whole unit is being developed," Commissioner Doug Goehring said.
New Millennium Resource Inc. must produce oil from the Zenith-Tyler "A" Unit, which is two miles northeast of Belfield, according to a commission order. If the wells are not brought back into production by Nov. 1, the company may have to plug and abandon the wells, Goehring said Tuesday.
There are four wells on the site that are supposed to be producing oil, said Lynn Helms, North Dakota Department of Mineral Resources director. Only one is in production.
The commission met April 25 for a public hearing on the wells. Mineral right owners Robert Procive of Belfield and Dan Feragen of Wibaux, Mont., told the commissioners some of the wells had not produced for three years and demanded they take action.
"I wish it would have been done a little sooner, but at least now they will start producing the field like their unit agreement says they are supposed to," Procive said Tuesday.
The commissioners stated they did not have jurisdiction over mineral rights, though Feragen wanted his below 8,700 feet returned to him.
A well that has not produced for more than a year is considered abandoned, according to North Dakota law. Two of the wells on the site violate this law, according to the order.
Goehring said he wasn't sure if the commission made anyone happy, but it wanted to give the company a chance to develop the unit.
"You can't just operate in one part of it and try to hold captive the rest of it," he said.
The order was fair, New Millennium President Jeff Collins said, adding the company has plans to bring the wells back into production.
Feragen said Tuesday the commission should give the company 60 days and was disappointed with the order. He added the November deadline was better than nothing and the company should be able to meet it if they put the time, money and effort into the unit.
"If it is at all successful by this added water flood, it will allow us to address some lost revenues over the last years, it will allow New Millennium to close out the field with some grace and dignity, our minerals we can lease out and everyone should live happily ever after," Feragen said.
Collins was surprised that the owners brought up discussion about the wells.
"I think we have been doing a pretty good job on the unit," he said. "We got 50-something working interest owners that never complained and have maybe 200-plus mineral owners, and there were just two people that had to complain. So we are doing pretty good."