Replies to This Discussion

Permalink Reply by Henry on August 13, 2010 at 12:57

kj,
For now, let's stick to Haynesville Shale only. And recent data -- 2010. I think I can make my point with just this info.
Thanks for providing your info. I really appreciate everyone's help.

• ▶ Reply

Permalink Reply by Lou Lou from LA on August 12, 2010 at 4:43

Thanks Henry for all the info. Keep up the good work we really need to know what is being paid!!

• ▶ Reply

Permalink Reply by waltcop on August 12, 2010 at 5:47

I agree with you Lou Lou.......thank you Henry. I don't have a well yet and did not lease to CHK but they did unitize our section. Will I be bound to sell my O & G to CHK?

• ▶ Reply

Permalink Reply by Henry on August 12, 2010 at 8:11

waltcop,
I hope not. But if your lessee assigned the lease over to CHK, you may be hosed.

• ▶ Reply

Permalink Reply by layla on August 12, 2010 at 6:02

Just an FYI which most probably know but no one seems to have mentioned in all this is that Louisiana Midstream is a wholly owned subsidiary of Chesapeake. This statement is based on information given by the employee of Chesapeake who negotiated the ROW across property we own in DeSoto. I specifically asked the question since we were leased to Chesapeake but the agreement was between us and La. Midstream. I had Google'd them and found two companies with almost the same name so I specifically asked the employee/landman/whatever he was (I have my own thoughts on what he is but this is a family-friendly website and I am a delicate flower of the South -lol!) who was who and what was what and he said "We are Chesapeake" when I asked how LA Midstream fit into this. If that information is correct, then it sounds like an effort (i.e. shell game) to sell gas to themselves at a reduced rate so that they can make more of a profit by paying less to the royalty owner or have I completely missed the point?

• ▶ Reply

Permalink Reply by JD on August 12, 2010 at 8:06

GoshD,

I saw a comment moments ago that appeared briefly and then disappeared. ??? For what it worth, I respect and appreciate your comments as well. I believe you are both on target. :)

JD

• ▶ Reply

Permalink Reply by adubu on August 12, 2010 at 8:35

JD---you probably saw the comment I posted below--I edited it couple time during the 15 minute window you can change and save reply-- so it may appeared briefly and then disappeared--- you know how Obama does but I wish he would not reappear again just get lost ---LOL :)

• ▶ Reply

Permalink Reply by JD on August 12, 2010 at 9:06

It was someone else's comment. But I liked yours as well.

• ▶ Reply

Permalink Reply by adubu on August 12, 2010 at 8:09

JD--layla--GD--Les B-kj--henry-- question about payment CHK receives as gas goes into pipeline (gross to well and used to calculate royalty owners net payment= gross minus deductions of taxes , etc-- SHOULD NOT HAVE TRANSPORTION CHARGES since was placed into pipeline at well head) then later pipeline sell gas at endpoint of delivery at price higher. This higher price should be what was paid at well head to CHK ( Wellhead Gross) + what the pipeline normally charges to transport gas to end point market user or to storage. For example they pay operator $4.10 for NG at well head then transport pipeline and pipeline charges are 0.55/mcf then the end user should be paying 4.10+0.55= total 4.65 then there is not a problem if the pipeline pays and charges all operators the same, but if CHK is paying below market to their wells and therefore pipeline charges are indirectly higher and as result royalt owner gets screwed then that is illegal and theft.

• ▶ Reply

Permalink Reply by Les Bamburg on August 12, 2010 at 9:52

Adubu, in most cases the pipeline is not purchasing the gas at the wellhead. So there is one of two scenarios.

1) Gas is sold to 3rd party marketer, utility, industrial, affiliated marketer, etc at some downstream point (ie $5.00/MMBtu). Gross wellhead gas price would be equal to downstream price less gas transportation cost (ie $5.00 - $0.45 = $4.55).

2) Gas is sold to 3rd party marketer, utility, industrial, affiliated marketer, etc at the wellhead. Gross wellhead gas price would be equal to gas sales price.

• ▶ Reply

Permalink Reply by w.r. frank on August 12, 2010 at 12:49

Les, if your lease says Lessor pays no cost for transportation, then in example 1) the lessee should absorb the cost of transportation for 100% of NG and royalty owner should receive $5. Otherwise the Lessor is absorbing cost of transportation. Correct? Otherwise, Lessee would never make example 2)?

• ▶ Reply

Permalink Reply by adubu on August 12, 2010 at 13:32

Les B--- If operator sells gas to the owner of pipeline near the well so operator has no deductions per say for transportation then this is operator gross price received for gas. ((Iam waiting to see wants happens next month live situation-- small independent pipeline from well runs only 1500' to pipeline owned by EOG-- EOG is purchasing gas at variable daily price as it run into EOG pipeline-- this price is final price operator receives since the point of sell is at point gas runs into EOG pipeline there is a compressor just few feet from point of enterance of gas into pipeline---therefore no transportation cost, compression fees, etc-- only deductions are taxes) What EOG downstream receives for gas has no effect on operators price received for gas. It will be intersting to see if those with royalty free gas clause receives any different net price than those without royalty free gas clause in lease. The price EOG pays operator for gas is obviously lower than what it sells gas downstream at final delivery point--EOG has to make profit + cover pipeline cost. Now if operator sold to point downstream and then paid pipeline ABC Company for transportation the net to operator would be gross price minus pipeline charges plus other fees--then no royalty free clause royalty owner would receive net after all deductions and royalty free owner would receive gross price paid downstream at point of sell minus only taxes. So Royalty free owner is screwed if gas sold to pipeline owner near well site. Similar if CHK sells gas to pipeline owner the price would be lower and sets up situation to easily screw royalty owner --- Les B IS THIS CORRECT?????? Please correct and explain if this is incorrect---Look forward to reply--- any one else also welcome to add their 2 cents

• ▶ Reply

• ‹ Previous
• 1
• …
• 6
• 7
• 8
• 9
• 10
• …
• 39
• Next ›
• Page