Commercial Well

AAA

DEFINITION of 'Commercial Well'

Any oil or gas drilling site that produces enough oil or gas so as to be commercially viable. All wells that investors are willing to put money into are considered to be commercial wells. Sites with non-producing wells fall outside this category, as do sites with only one or two wells (unless their production is extremely high on a consistent basis).

INVESTOPEDIA EXPLAINS 'Commercial Well'

Limited partnerships typically will syndicate a share of a commercial well. As well, owners of working interests and those who receive royalties also invest in commercial wells. Investment interest in viable commercial wells is often high, due to their inherent profitability.

RELATED TERMS
  1. Farmout

    The assignment of part or all of an oil, natural gas or mineral ...
  2. Primary Recovery

    The first stage of oil and gas production, in which natural reservoir ...
  3. BP Oil Spill

    A 2010 oil spill that occurred in the Gulf of Mexico as a result ...
  4. 3P

    The total amount of reserves that a company estimates having ...
  5. Oil Field

    A tract of land used for extracting petroleum, or crude oil, ...
  6. Sweet Crude

    A type of oil that meets certain content requirements, including ...
RELATED FAQS
  1. How do the costs of oil sands producers compare to traditional drillers?

    The oil sands of Canada are some of the most expensive crude oil assets in the world to produce. Each asset type, such as ... Read Full Answer >>
  2. Do all oil companies received the quoted price of West Texas Intermediate for their ...

    The quoted, or spot, price of West Texas Intermediate, or WTI, crude oil is just one of several benchmark oil prices. The ... Read Full Answer >>
  3. How do the average costs compare for the different types of oil drilling rigs?

    Average costs vary widely between different types of oil rigs, starting at around $20 million and ranging as high as close ... Read Full Answer >>
  4. How long does it take an oil and gas producer to go from drilling to production?

    Depending on the depth of drilling required and the type of drilling method used, a standard oil well can commonly advance ... Read Full Answer >>
  5. What credit rating should I look for in an oil and gas company?

    Look for a credit rating in an oil and gas company that is suitable for your desired returns and risk tolerance level. Companies ... Read Full Answer >>
  6. How does an oil and gas company measure and state its production?

    Measuring Oil and Gas Production Oil and gas exploration and production companies, or E&P companies, use three basic ... Read Full Answer >>
Related Articles
  1. Active Trading

    Oil And Gas Industry Primer

    Before jumping into this hot sector, learn how these companies make their money.
  2. Savings

    Do Oil Prices Affect The Auto Industry?

    Based on an understanding of complementary and substitute goods, the American auto industry is exhibiting expected effects from the recent plunge in the price of oil.
  3. Professionals

    How Going Green Can Cut Your Taxes

    Investors looking to improve their bottom line via green investing without risk should take advantage of these tax credits.
  4. Entrepreneurship

    Three Steps Elon Musk Took To Become Successful

    What steps did Elon Musk take to become the person he is today? We explore three steps that are accessible to all of us.
  5. Chart Advisor

    3 Ways To Trade Oil's Move Lower

    The spot price of oil is facing major resistance. We'll take a look at a few products that you can see to profit from the move.
  6. Options & Futures

    Will Oil Ever Go Back Up To $100?

    Experts have yet to reach a consensus on whether oil will return to $100, but recent events could give us some clues to its future price changes.
  7. Investing

    4 Future Jobs In The Sci-Fi Future

    As long as the human race has problems, we'll continue developing new things and ideas to solve those problems.
  8. Chart Advisor

    Expect These Gold-Related Assets To Move Lower

    The spot gold price is trading within a long-term descending triangle. Traders may use this pattern to suggest gold and related assets are heading lower.
  9. Stock Analysis

    Make a Downstream Bet with Oil Refiners

    Now is a good time to bet on the oil refinery sector. Here's why.
  10. Professionals

    Are Energy MLPs a Good Bet Right Now?

    Energy MLPs offer good long-term potential. Here's why.

You May Also Like

Hot Definitions
  1. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  2. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  3. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  4. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
  5. International Monetary Fund - IMF

    An international organization created for the purpose of: 1. Promoting global monetary and exchange stability. 2. Facilitating ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!