Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on March 27, 2009 at 2:35

Catfish. It has been tried in the past and didn't get too far. The reason being the number of members who were too mad or too suspicious to listen to what the industry members wished to tell them. There are advantages and disadvantages to group representation/negotiation. It is just so disappointing that after all this time and all the examples of failed group efforts, the same mistakes are being repeated. If you would like to start the discussion and attempt to moderate a reasoned exchanged, I will agree to participate.

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Permalink Reply by Catfish on March 27, 2009 at 3:47

I think I"ll pass, not having enough knowledge on the subject to give out factual info. I do have a question if you don't mind giving an opinion. Will the 0&G industry allow it to become popular to go unleased? It's seems like the risk factor favors the mineral owner in this play and if it turns out to be alot more profitable to go unleased how will the industry deal with this?

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Permalink Reply by Skip Peel - Mineral Consultant on March 27, 2009 at 4:18

Deciding not to enter into a lease agreement is every land/mineral owners option. And, as in so many other instances in this play, there is no stock answer because there are wide variances in the material facts concerning each circumstance.The amount of unleased acreage in a section is a condition affecting companies' decisions where to spend their development dollars. It is not economical to develop sections with too high a percentage of unleased acres. How high is too high? Varies by operator and specific circumstance. I am not sure I understand your "risk factor" comment. Whether leased or not, if your section is not developed, there is no profit. For any party.

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Permalink Reply by Catfish on March 27, 2009 at 4:33

Skip, Going unleased is a risk that could leave the owner with no money is what I meant.

Permalink Reply by Skip Peel - Mineral Consultant on March 27, 2009 at 4:48

Catfish. You are correct that deciding to forgo a lease can lead to no mineral income. Now the question is, How many members would agree with that statement? I suspect many would take the position that they "don't mind holding out" and it's "their minerals and they aren't going anywhere". Also correct. What does not usually get taken into account nor discussed is "time". For landowners who are willing and able to wait 10, 20, or more years, their odds of being correct are very good. The last Haynesville Shale wells drilled in NW LA. may be 20 to 25 years in the future. It's not like there's a shortage of prospective acreage for E&P companies to develop. And as the Haynesville has eclipsed the Barnett and numerous conventional on-shore plays, it will be eclipsed in time. There will be other options and opportunities in the future where E&Ps may prefer to invest their capital. When Haynesville Shale drilling ceases to be the preferred natural gas play in which to invest, there will be undeveloped sections that still remain.

Permalink Reply by Catfish on March 27, 2009 at 5:09

Skip, there is "no reply" for your last post. Thanks for the insight my thought always has been get the best lease and payment you can and go for it. The "time" factor should be a deciding factor. The day I signed my last lease was the day before the bottom fell out. You never know! By the way my wife thought I was smart.LOL

Permalink Reply by James CD1 on March 28, 2009 at 15:03

Skip, I know you are busy but could you discuss the "donut hole" next week. Anxiously but
patiently waiting your reply.

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Permalink Reply by Skip Peel - Mineral Consultant on March 28, 2009 at 16:25

James. If I can get it done in time, I plan to post an update to the township grid tomorrow. One of the donut holes just disappeared in the last 24 hours. That was 18N-12W. The term, "donut", refers to a township with no HA unit applications surrounded by townships that do. It's an unshaded township within my grid map representing the current boundaries of the play. The last two holes, including 18N-12W, are characterized by significant portions being suburban in nature and thus densely populated and developed. They should be very productive areas but they will be more difficult and expensive to develop owing to the above described challenges.

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Permalink Reply by sesport on March 28, 2009 at 16:38

Skip - Just saw your new discussion and was going to ask if this was "THE" donut hole. I had to print the map or risk a) a crick in my neck or b) losing control of my scrolling while I held the laptop sideways. lol

Seriously, though, I'm trying to figure out if this is the area that gives access to the East Reservation. I'm lost without roads being indicated.

Also, are these sections also some of the same that East 80 Coalition was discussing?

Thanks for staying on top of it, best - sesport :0)

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Permalink Reply by Skip Peel - Mineral Consultant on March 28, 2009 at 16:47

sesport. One of two. The only remaining one is 17N-14W. That is the 6 X 6 mile square township north and west of Forbing and encompassing much of S/ SW Shreveport and extending north of I-20 to about Cross Lake. Be careful scrolling while holding that laptop sideways. I do not think Keith is insured for that kind of thing. LOL! I was wondering the same thing regarding the East 80 Coalition and asked Taylor in the other thread the same question.

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Permalink Reply by J. A. on March 28, 2009 at 16:54

Any updates on the herold well flow rates?
I am curious about the section one over to the east
thanks skip

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Permalink Reply by Skip Peel - Mineral Consultant on March 29, 2009 at 2:08

The S L Herold is flowing back fluids. I suspect the Initial Production is known but has not been released for public consumption. HK will make sure the well has finished cleaning up and stabilized before settling on the IP rate. Early rumors are that it is not a "monster" but is significantly more productive then other recent north Caddo wells.

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