Class Action Suit May Affect 50,000 Haynesville Shale Landowners
On April 10, 2010 a class action suit was filed affecting Haynesville Shale property owners in all of the Haynesville Fields of north Louisiana. The suit is filed against the Commissioner of Conservation and operators in the Haynesville Fields. The basis of the suit is that the Commissioner of Conservation is authorized by statute to establish a production unit that can be drained by one well. Members within one of the proposed classes are being denied their pro-rata share of production and the other class members are being denied their market value of their leasehold interest ownership. This may affect some 50,000 property owners in northwest Louisiana!
We have met with some of the attorneys and are pleased with the representation. The attorneys are class action attorneys Fayard & Honeycutt of Denham Springs; Simon, Peragine, Smith & Redfearn, LLP of New Orleans; Law Offices of Rudolph Estess, Jr. of Baton Rouge (in that office as special counsel is Jack C. Caldwell), Charles Tutt of Shreveport, Cave Law Firm of Baton Rouge, and Ryan Gatti an attorney from Bossier City. Through our own independent research we have learned that Mr. Caldwell was a contributing author to the Louisiana Mineral Code and also served as Secretary of the Department of Natural Resources.
If successful this would create a tremendous economic boom to this area by creation of many more jobs, not to mention a substantial increase to severance taxes to the state of Louisiana. We have received per request a filed copy of the pleadings filed in East Baton Rouge Parish. The suit explains the law and the resulting violation. Should you desire a copy of the suit please email your request to us at: www.fairdrilling.com. You may also wish to contact your attorney or local attorney for the group, Mr Gatti.
Andrew
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Replies to This Discussion
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Permalink Reply by Andrew Walker on
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Early? Baron Baron Baron. We need to set your alarm clock. Think of all the Americans you could be shooting down if you would wake up sooner.
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Permalink Reply by BirdDawg, plain ole' idiot on
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Andrew,
No I am not confused. I know the class action law suit is not your suit. But it might as well be your suit, as evidenced by your discussion and posts. But you mentioned your CV suit in Desoto. Let me guess, if you win it, you will receive all (or most) of the royalties from the small unit you propose? Under the proposed units you advocate, in the Vernon Field in Jackson Parish some of the units would have to be 20 acres, as some of their better units were drilled on 20 acre spacing. Now who would that be fair to? No one, in my opinion. It has already been discussed on this site that some HA wells that have been pulled hard have evidenced reduction in the reservoir pressure when adjacent wells were drilled. So the first unit well drilled appears to affect the pressure of the adjacent wells. Hmm, under your plan how do you decide who gets to drill the first well? Who gets to take advantage of the best pressure? Fair? I don't think so. There is probably some communication that could affect adjacent wells. And this is one reason why your (their) law suit will fall on its face. Just my opinion, and my hope.
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Permalink Reply by Andrew Walker on
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You guess wrong, BirdDawg. In regard to my DeSoto Cotton Valley suit, I will not receive "all (or most) of the royalties from the small unit..." I am nothing but a lowly surface owner who is facing one well every 20 acres across my 700 acre tract in the units - plus access roads, pipelines, etc - while a neighbor (with a 1000+acre tract in the units) faces zero wells ...and for no geological, topographical, or engineering reason. It's not fair apportionment.
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Permalink Reply by E & E on -
Note: This does not include decline rate, price fluctuation, etc.
10 Mcf per day well
$4.00 gas price is $40,000 per day
If you owned 20 acres in a 80 acre unit with a 25% royalty equals 0.0625
$2,500.00 Royalty per day
$912,500 IF they produce every day for a year which wont happen.
If you owned 20 acres in a 640 acre unit with a 25% royalty equals 0.0078125
$312.50 Royalty per day
$114,062.50 IF they produce every day for a year which wont happen.
But here is were it gets sticky:
In the 80 acre unit, you are limited to only ONE well due to spacing.
In the 640 you can have up to 8 wells in your unit due to spacing, which brings your Royalty up to $312.50 x 8 wells to $2,500.00 per day.
So it is the same amount of Royalty in the end.
There are several things that would happen if this lawsuit prevails, but the biggest thing would be the amount of people that would be cut out of a unit getting Nothing forever. And there is nothing that can be said that would make me see it any different. Oh and exactly what happens if the well goes bad? There is no more drilling in this so called 80 acre unit due to spacing. So then you are $h out of luck. I don't know about others, but I would rather have alittle mailbox money along the way.......
Earlene drinking her coffee this morn
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Permalink Reply by sesport on
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E - You left out depletion rate. One well will be depleted in X number of years, leaving mineral owners with little/no production. The 8 wells, drilled over time, and probably as initial wells mature & are depleted, will ensure continued production AND royalty/revenue.
80)
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Permalink Reply by Linda Whatley on
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That's exactly what I was thinking Earlene........
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Permalink Reply by E & E on
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Goshdarn,
Thanks, can you tell this gets my "goat"? lol I just really have to wonder exactly what was told to the 50,000 that is involved in this class action. I have read the filing for this lawsuit.....can you say legalease?? Sometimes on paper you can see things and that is all I was trying to do with my post today. BTW that is same kinda thing that I was worried about when it came to leasing for the people who had never leased b4 the shale. Oil Field terms are thrown around and lots of people had never heard these words. One reason ghs has been so valuable. I am only hoping that people decide for themselves what is best for their over all situation.
Earlene
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Goshdarn & Earlene,
You guys gotta be the most straight talking folks on here.........and I totally agree with your comments. I too think the little property/mineral rights owners could lose big time if this lawsuit prevails. I say keep it at 640 acre units, and let's all look forward to our prorata "piece of the pie."
LJW
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Mr. Walker,
How do you propose exactly how many acres any given well (to any depth) that can be drained by one well?
No one can, and you know that. Therein lies the problem, or one of them anyway.
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