Leasing

My brothers and I are in the process of having our mothers succession done. We have been discussing leasing the property with JW Porter ( Chesapeake), but the rep. with JW Porter is pressuring us to hurry and sign. She (JW Porter) is telling us Chesapeake will force pool us if we don't hurry. Can they do this? And what do you suggest we do at this point.

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Permalink Reply by Rod B. on February 7, 2009 at 7:01
Don't know, they do have a drilling permit.
Permalink Reply by Checkmateking on February 7, 2009 at 5:29
Tell her go ahead, you don't mind not giving them 75% of your royalties,.
Permalink Reply by Rod B. on February 7, 2009 at 7:04
What do you mean?
Permalink Reply by Rod B. on February 7, 2009 at 7:03
But if I let them, don't I lose the bonus money they're offering?
Permalink Reply by Snake Stewart on February 7, 2009 at 7:39
How much are they really offering Mr.Fisher ?
A couple hundred, a thousand, maybe even $2000 ?
If you live on the Haynesville Shale, your acreage could be worth hundreds of thousands of dollars to you, maybe even millions, depending on the location of your acreage and the quality of well that gets drilled in your section.

Low Natural Gas prices are something that we do not have any control over, yet still affect us in a negative way while we are being paid royalties. As all of the O&G pro's out there have been preaching for so many months now, the bonus isnt where the real money is. Unless of course you have a weak lease and they drill you a puny weak vertical to HBP. I do view the bonus in a somewhat different manner. I tend to look at it as a measure of how serious they are about drilling a quality well and actually working the section vs HBP.

While N/G prices are lower, they dont make the same monies as they would while N/G prices were up. But like I said , we dont have any control over that.We do have control over what we are willing to settle for, bonus wise and with lease considerations, while we are unleased. You may only get one shot at this. Better take a good shot while you can. There are many facets to this play. If you dont understand any one of them, stop what you are doing and find out. Do not sign anything that you dont fully understand. If your acreage is large enough it may warrant a call to an O&G attorney if you cant find the answers that you need. There is plenty of information on this site. Probably the greatest collection of mouth to mouth dialogue, from both sides, on the planet on this issue.But not all info is good tho. If you do not feel comfortable weeding through it youself and dont have a group that is trying to look out for each others best interests, that call may be the safest bet for you and yours.

Have a great one Mr. Fisher and good luck.
Permalink Reply by Rod B. on February 7, 2009 at 11:43
They are offering $3500 @ arce and 25% royalty on 11 acres of land. Don't know if it's worth getting an attorney.
Permalink Reply by chattykb on February 7, 2009 at 9:57
Wow KB, I have to read that a few times to understand it. Is it based on owning 100% of the mineral rights? In my case in Ark., my contract is base on net acres in the lease which is only 4, and it has been divided many times as it has been passed down through the family. I don't think there's much money to had after the trickle effect. I wished! Thanks for taking the time to do that.
Permalink Reply by Greedy Landowner on February 7, 2009 at 22:01
Is your land in southwest desoto parish?
Permalink Reply by chattykb on February 7, 2009 at 7:34
KB, Couldn't they make you a non-participant where you'd have to participate in the drilling cost or do an integration like in Arkansas? page 19 http://www.aogc.state.ar.us/PDF/Leasing%20Manual%202008.pdf
Permalink Reply by chattykb on February 7, 2009 at 8:50
I'm trying to understand all of this in regards to offers being made and then being retracted. I got an offer in Columbia Co. Ark. that I countered, but he refused. (He offered 1/8 RI and 1/16 ORRI, I want 1/4 RI period). From what I've read from the manual online (page 19 but page 23 in pdf. form), I'm a little scared. I think that I can still accept their offer if it comes to that and they have to let me, if I've interpeted it right. I think I just need to get a paid opinion to tell me the bottom line of it all.
Permalink Reply by Two Dogs, Pirate on February 7, 2009 at 10:52
When they force pool you in Ark the clerk of court signs the lease for you. I think they give you whatever the average percentage that others got but it may be based on the highest percentage given. It is a BS way of doing things, Louisiana is much better. You can run your name in the records and you will not find your lease you have to run the clerk of courts name to find your lease. I hope I never have to work in Ark again.
Permalink Reply by The_Baron on February 9, 2009 at 5:47
Amen Two Dogs,

Piss poor records, blind indices, no prescription, no surname grouping in the index books, oh my....not to mention trying to track down long lost great grand children of mineral owners......

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