LINN Energy looks forward to continuing the positive work Berry began and shares in the commitment to developing its oil and gas resources in the Permian Basin responsibly LINN’s future development plans remain consistent with those that Berry previously shared with the Gardendale community.
At the end of 2012, construction of an approximately $10 million central tank battery in Gardendale was completed. This facility reduces the amount of heavy truck traffic, noise, individual flares and odors from the Company’s operations in the Gardendale community. To date, the majority of the pipeline to the central facility has been installed. This pipeline will serve as a gathering system to transport oil, produced water and natural gas from the Company’s satellite batteries located throughout Gardendale to the gathering tanks located at the central battery. Additionally, the pipeline will minimize truck traffic that otherwise would have been on the roads transporting materials to and from individual well sites.
As of December 2013, 63 wells have been drilled by Berry or its predecessor, with 31 of those wells drilled in 2013. Some residents have asked for a drilling schedule; unfortunately, it is difficult to accurately predict the exact number, location and timing of the wells as the drilling schedule changes frequently. However, surface owners whose properties have been drilled were notified in advance and given the opportunity to ask questions.
How many wells does LINN Energy plan to drill in Gardendale?
It is difficult to accurately predict the exact number of wells that we will drill in total, and per year, as both the total number of wells and the number of wells per year is dependent upon many factors, including rig availability and oil field costs, regulatory requirements, commodity markets and prices, drilling results and other production factors, general economic conditions and capital budgets. However, LINN’s current plan, which remains consistent with Berry’s, is to drill approximately 140 wells on 40-acre spacing in and around the Gardendale area during the next several years.
Additionally, we have staked locations to conduct a pilot study on 20-acre spacing and, if those test results are encouraging and economic conditions warrant, we may drill up to 160 additional wells. At the current time, there are no plans to drill on five or ten-acre spacing.
Is LINN Energy staking well sites on 20-acre spacing?
Some Gardendale residents have received letters notifying them that Berry, now LINN, has begun staking locations for approximately 60 wells on 20-acre spacing in the Gardendale area. The Company is evaluating well data in order to determine the viability of 20-acre development. If the results are encouraging, and drainage patterns and economic conditions warrant, we may drill additional wells. These well locations will be staked based upon our current geologic interpretation of the area; however, the wells being currently staked might not be drilled or included as part of the initial pilot and locations are subject to change.