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Permalink Reply by BK on May 18, 2015 at 7:16

Thanks for the insight. We asked the landman a few questions and haven't heard back from him in over 4wks. The area is Section 20, township 18 North, Range 1 West, Lincoln Parish. Are you familiar with this area? I read MRD's last report and didn't see any activity in this area, but could be wrong. There are several cousins involved in this but only a few were sent leases. All confusing to us so any suggestions you may have would be greatly appreciated.

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Permalink Reply by Skip Peel - Mineral Consultant on May 18, 2015 at 7:22

I doubt you will have to wait long to hear from companies leasing in your area.  In 18N-1W, there are a well awaiting completion in Section 14, rigs drilling currently in 18 and 21 and active permits for wells in 13 and 15.  No well results made public at this time but a good bit of leasing activity.

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Permalink Reply by BK on May 18, 2015 at 7:37

Great thanks! We were ready to sign the lease but when other cousins were contacted but not sent leases we just wondered why. Will sit tight and ride it out.

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Permalink Reply by Skip Peel - Mineral Consultant on May 18, 2015 at 7:41

Don't get rushed.  It is possible that there is competition for leases in your area.  Competition is always beneficial for those who can use it to their advantage in negotiations.

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Permalink Reply by Two Dogs, Pirate on April 13, 2015 at 10:41

Yep, happens all the time.

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Permalink Reply by 208ef0t5wi05p on April 14, 2015 at 12:51

If the Haynesville Shale is better than the Utica and Marcellus Shales, which it seems to be with the Utica drillers moving back to the Haynesville, why not ask for what we have been getting: $2,500 to $6,000 per acre, with Greene County PA seeing $8,000 an acre due to being in the Rome Trough area.

The March 2011 ALOV Landowners Group, all received $2,500 an acre, followed by the November 2011 ALOV Landowners Group receiving $5,600 an acre.

1/4% Royalty is .0025, how about 1/8th or 12% (0.12) which is the minimum royalty in most states. You didn't mention Gross vs Net. 

Again the ALOV Landowners got a 17.5% Gross Royalty in March 2011, with the Nov 2011 ALOV Landowners Group getting 20% Gross Royalty.

Negotiating your own lease with an O&G company is guaranteed to leave you with no landowner protection and a poor lease as far as a bonus and royalty go.

My advice has been NEVER SIGN AN O&G COMPANY LEASE, have a lawyer provide you with a fair lease, then only sign with a drilling company. If you sign a lease with a non-driller, they will sell your lease to the driller and take a percentage of the royalty you could have had and the bonus you should have gotten. Go to alov.us and open up the lease at the bottom of the page titled: SURE Lease March 2012 and you'll see what a good lease looks like. Use it as a starting point with your lawyer.   Good Luck.

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Permalink Reply by Two Dogs, Pirate on April 14, 2015 at 13:09

I don't know of much leasing going on in the Haynesville Shale. Most of it being leased from 2007-2010. A lot of these mineral owners got over $20,000 per acre. Most of these leases in the sweet spots are held by production (HBP). The rigs are drilling alternate wells in HBP units.

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Permalink Reply by Skip Peel - Mineral Consultant on April 14, 2015 at 13:25

TD.P is correct.  There is little unleased land prospective for Haynesville Shale.  The lands alluded to in this thread are not prospective for Haynesville Shale.  The companies active in Lincoln Parish are drilling the Cotton Valley Sand Group.  The Haynesville Shale is an unconventional reservoir.  The Cotton Valley is a conventional reservoir. 

Ron, we regularly encourage GHS members to engage the services of an experienced O&G attorney when considering an offer to lease.  Owing to the significant differences in LA mineral law it is not a good idea to use a lease form from another state.

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Permalink Reply by Chris on December 30, 2015 at 12:15

Haynesville Shale is actually way less economic then the Marcellus or Utica. No one is making money at current prices. Also Lincoln County leases are not for Haynesville drilling. Believe it or not there are other ways to drill for O&G than shale wells.

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Permalink Reply by Rock Man on December 30, 2015 at 12:21

Lincoln Parish most likely Cotton Valley Sand and perhaps Bossier Sand

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Permalink Reply by Skip Peel - Mineral Consultant on December 30, 2015 at 12:22

Chris, the members are aware that the Lincoln Parish development activity is a conventional Cotton Valley combo play.  Haynesville Shale needs to be north of $2.50/MMbtu for operators to make a profit.  Most would be happy with $3.

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Permalink Reply by Rock Man on December 30, 2015 at 12:39

Speaking of Utica, I was talking to a group the other day that has a very good (IP 20+ MMCFD) Utica gas well in Ohio with a 80+% NRI lease.

But due to pipeline limitations, they are only netting about $.80 per MCF.

Underscores the issue of take away prices versus "posted prices" for both O&G across various plays. At least the deducts on oil have dropped in many areas (e.g. Permian was over $10 per BO deduct - now less than $5 per BO)

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