What will HShale play become when gas is at 13.00 again?

I have read some great postings on this site. Some good answers from some insightful people. I am pretty ignorant about the mineral stuff, but you have really helped me to become less so.

I have a question, bugging me and I invite your insight on it.

What do you thing the landscape in the HS play will look like if in the next five years the price for gas goes back up to the 13.00 mark. It seems to me there will be a lot of differences in how it plays out, but I just don't know what they would be.

I know that one major difference will be in the level of education on the part of land owners, making them more respected by the O&G, but what all else will change?

What do you think? Please!

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Permalink Reply by Snake Stewart on November 16, 2008 at 2:54
Come on KB. You havent had time to fill out the 926 page questionaire that must be filled out and approved by the handlers, before you could have access to that intel. Not to mention the fact that you have had way more questionable E-mails then are allowed.

You play the other extreme well. Hope you havent become the Seer!
Permalink Reply by Snake Stewart on November 16, 2008 at 3:27
I have no idea what you just said but I am sure its all good.Its not unbearable with a little garlic.........Crow that is. It isnt my favorite but one must do what one must do.
Permalink Reply by Cheerleader on November 16, 2008 at 13:32
Does anyone know a good constitutional attorney....Oh! I forgot Obama!
Permalink Reply by The_Baron on November 14, 2008 at 8:14
Wow, we must have hit nerve.
Permalink Reply by Antsu-in-Japan on November 15, 2008 at 4:52
Intrepid and Baron: that is an excellent point that we should consider. As such, we must keep on top of what our government intends to do (in regards to natural gas) and be proactive in what we will do, as landowners, to protect our minerals in the case that such a threat becomes our reality. The US has gone out of its way to protect other countries when landowners were shortchanged: seems ironic that it would turn on its own citizens. Still, it is something that we MUST be prepared for.

In the same respect, as KB warned, I'm not going to get myself overly worked up over something that may not even happen...but I will be keeping my eyes open for ANY change in "climate" regarding government interest in our minerals.

http://www.natural-resources.org/minerals/CD/docs/unctad/dist_learn...

PS....the one thing that sets me a little at ease is that some of our most powerful legislators also own land and make money off of their minerals. I'm sure they'll be the first to fight any attempt by our government to acquire the minerals beneath our land.
Permalink Reply by intrepid on November 14, 2008 at 10:04
Natinalization of mineral rights is VERY LIKELY something that is already being kicked around by the Obama transition team. Probably in the form of higher taxes that will for all practical effects take away any benefit you might expect to receive from your mineral rights.

You may still 'technically' own them but remember that the power to tax is the power to destroy.

And Obama has already said he would destroy the coal industry by bankrupting anyone who would build a coal fired plant.

This President is dangerous.
Permalink Reply by Martin on November 14, 2008 at 10:13
Well, GoshDarn does have a point. There are times when I read some of the more radical postings on this site that I wonder if 1) the author is a troll, just trying to wind up the rest of us 2) the author is listening to Rush or Hanity and transcribing the show in real time or 3) the author is an insomniac that has stayed up all night listening to AM radio and has over loaded his/her brain with fatigue and caffeine. But then I haven't read anything about the Greys or alien abduction .... yet. 4) the author truly believes the posting. That is scary for some of us.
Permalink Reply by v on November 14, 2008 at 12:34
Or the author is truly a thoughtful insightful realist. There are so many promises made by BO that he will have to find a "painless" way to pay for them. Taxes? Eminent Domain? It takes a village mentality? Remember how many people were upset that they did not get the $30,000.00 per acre, or have sold land and not retained minerals or The evil oil company stole from us. That mentality will go along way towards allowing BIG GOV. and BO to do as they please. It makes me wonder how many people would actually object to taking the minerals. Democrat Maxine Waters already has said she would like to see Big oil nationalized. I have seen it somewhere that at $6.00 per thousand and $25,000.00 per acre lease it would still generate a 40% return.
Permalink Reply by v on November 14, 2008 at 12:41
Permalink Reply by George Davis on November 14, 2008 at 11:43
Gas is not going back to $13 anytime soon. And if it does, it will be a price spike, not a long term average. The question to be asked is will Oil Companies ever pay what they paid for lease bonuses before the "bubble"???? Not in our lifetime!! Like the housing bubble, there has been a shale play bonus bubble. And Wallstreet drove the bubble, and now they have been hurt by it. You will be seing a glut of leases in most shale plays in the US being sold at discounts or farmed out to third parties so oil companies can try to get back the huge sums they paid for lease bonuses. The "Bonus Bubble" has burst. Its over. Gas will be at $5-8 for a couple of years. Time to be thinking about how to get "royalties" working. Hville shale is not economic without low lease bonus costs.
Permalink Reply by North LA on November 14, 2008 at 12:32
George. Are you the guy who brokered the deal for the $1.00/acre lease with the city of Shreveport :)
Permalink Reply by ALongview on November 14, 2008 at 12:40
George, I am curious if low lease bonuses to make the Haynesville shale economical is 2-3 hundred/acre or 2-3 thousand/acre?

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