Replies to This Discussion

Permalink Reply by ALongview on July 31, 2009 at 13:08

OGMLA, We are all hoping for the same outcome and I can certainly respect your experience. Two people with differing opinions about a predicted outcome make a market.....it's the American way! Good luck to you and I do hope it gets better out there sooner than later, especially for all the people who work hard in the O&G industry.

Permalink Reply by Bill R on July 31, 2009 at 17:38

Okay.... another 'dumb' question.... at what price point will Natural Gas be worth drilling for again? I assume it is somewhere around the mid to high $5 range.
Also, just a FYI on the leasing bonus... we received $2100/acre on the last one.
Thanks again

Permalink Reply by Candi on August 20, 2009 at 9:56

we got contacted by a land man a couple months agosaying a natural gas company wanted to lease the mineral rights. we just got a call last week from the energy company saying they are putting two rigs on the property hopefully by the end of the year. they want them up and drilling the first of the year.

Permalink Reply by ALongview on August 20, 2009 at 10:01

Candi, Do you mind sharing what company contacted you and where your land is? Also, was the first contact from the landman from the same company as the call last week? It helps us all to know where the activity is headed. Thanks!

Permalink Reply by Candi on August 20, 2009 at 10:07

The first person to contact us was not with an energy company. he was the one who did the research in finding us. My husbands great-great grand father owned the mineral rights. we were clue less until we were contacted. we do not own the land. The person who contacted us last week is from southwest. the land is in New Hope, which is really small from what i hear, but i am told denning is like considered the bigger city

Permalink Reply by Candi on August 20, 2009 at 10:10

are you familiar with that area? we have never been there, so i am not to sure exactly where it is.

Permalink Reply by Candi on August 20, 2009 at 10:33

we are completely confused about all this and know absolutely nothing. is this something common? they will be paying 1/5 royalties. i have had one person tell me that is good and another say it is not good. any info you may have will help. some people say if they are putting two rigs on the trek of land they must know somethin is there. other people say it means absolutely nothing

Permalink Reply by adubu on August 20, 2009 at 10:52

Candi---Southwest Energy is excellent oil & gas operator. Their stock trades on the NYSE ---SWN---look up there web site and read some of their presentations you will see lot of info drilling in east texas area. They have JV with Common resources on several wells. Your question about whats a good lease. In general you want best terms you can get. There 1st offer is always the lowest. Remember they want to lease your minerals or someone will. Lease ONLY WITH THE OPERATOR THAT IS GOING TO DRILL watch out for the middle guy who will lease and flip your lease (sell it) and keep part of your royalty. ASK QUESTIONS. Sample of good terms-- max 3 year lease with no option, 25% royalty, Vertical pugh clause, freestone clause, royalty free oil & gas, and nice bonus always nice--today range 400-1000 depended what area you are in and how hot the play is. Then unless you are very knowledgable do not sign any lease untill you have a Oil & Gas attorney review it for you. The fee you pay to attorney will be minimal compared to a lease you could have to live with for ever

Permalink Reply by ALongview on August 20, 2009 at 11:00

Candi, That does seem to be in one of the hotter areas right now and Southwestern is a great company. Other than that....see above. All good advice from adubu.

Permalink Reply by Candi on August 21, 2009 at 0:54

unfortunately, we already signed the lease a couple months ago when they mailed it to us. last week is when we got the call from SWN saying they are putting two rigs on our trek of land by the end of this year. they mailed us an heirship afidavit to verify my husbands father and sister had no more children than the ones they originally know about. it had to be notarized by someone outside the family who knew. i sure wish i knew about this site before hand. i have no idea if this is part of the haynesville shale.

Permalink Reply by ALongview on August 21, 2009 at 3:14

The current bonus in the area is nowhere near 5k or 6k anymore. It is more in the area of 500-1000 dollars/acre. I listened to a webinar yesterday that stated that leases are getting longer on average(4 yrs) and royalty is getting smaller on average(22.5%). Be thankful that you found out about this and were able to sign a lease in the Haynesville Shale. I couldn't quite tell whom you signed with but if it was with Southwestern, they are a great company. If you don't mind, how many gross acres did gggrandfather have rights to?

Permalink Reply by Candi on August 21, 2009 at 3:47

i do not even know if it is part of the Haynesville Shale. i have not seen that name anywhere on any paperwork. i know it is Southwestern and Common something. i really don't know how many acres. total. Back in the 60's I think, there was a big dispute about the property among all the siblings of the great grandfather(when he died) the land was divided among all the siblings. then it became a big family war about the property and lawsuits were filed and half the siblings didn't speak to the other half of the siblings the rest of there lives., etc etc I really don't know the details. only half of the siblings were on the lease agreement. then when they called, they said that both rigs are being put on my husbands grand fathers trek of land only (the mineral rights, we don't own the land) so that is why they sent the afidavit about his two children and their children. They said the other people on the lease are not involved now because it is this sides (meaning my husband, his sister and their three cousins) trek of land. someone at my work has said that is not true because although the rigs are on our trek, they will still be pulling from the other treks. i do not know how much land in all there is. the paper work had different parts listed to all of the grandchildren. i do not have that paerwork with me at work to look.

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