Mineral owner objects to KeyRock’s $2.2 million AFE for Honey Camp No. 1; board extends election deadline 30 days

Mark Stuckey, a mineral owner, told the Virginia Gas and Oil Board on Aug. 19 that he opposes KeyRock’s revised Authorization for Expenditure, or AFE, for the Honey Camp No. 1 well and asked the board for protections for working interest owners.

Stuckey said the operator revised the AFE from roughly $186,000 to about $2,186,000 and that he received notice of the revision only the day before the meeting. "I speak in opposition to KeyRocks proposed AFE revision to the Honey Camp number 1 well from a $186,000 to $2,186,000," Stuckey said. He said he and his brother hold small working interests (stated in the meeting as 1.1 and 0.55 percent, respectively) and that the new AFE effectively prevents them from participating as working interest owners.

The proposed revision, Stuckey said, classifies roughly $1,700,000 as intangible drilling costs. "I do not believe that these costs would qualify as IDCs," he said, adding that he spent the first nine years of his career in financial analysis…