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Permalink Reply by Charmine on August 23, 2009 at 15:39

How many acres Foxie?

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Permalink Reply by Alamo on July 3, 2008 at 7:34

My brthers and I were offered $400/Acre and 25 per cent in south Rusk County and we countered with $1000 and 25 per cent AND a vertical Pugh clause to the top of the Cotton Valley. Waiting on their reply . Total family acreage entails around 530 acres: of this total family members have leased around 245 acres at the $400 and 25 per cent royalty figure leavig 285 or so still uneased and waiting on an answer to our counter offer.

The way we view things is essentially that bonus money is nice--very nice, but it's the royalty negotiation which will make far and away the most money over the 30 to 50 years' time these gas wells are producing. Our gas production in the Trawick Field in Nacogdoches County has been paying us--(our family) royalties since 1950 and we have seen little depletion since that time and the price we are getting per thousand cubic feet has skyrocketed in the last 3-4years. (Natural gas was selling a $.14 per MCF in 1962 and it's around $10.00 per MCF now. At $10.00 it's less than half the cost of crude oil on a BTU adjusted basis so natural gas is likely to remain in an upward trend dollar-wise.

Good luck on your negotiations over in Shelby County, a very good area according to T Boone Pickens' EXCO Resources evaluation. EXCO Resources' maps strongly suggest that the Haynesville Shale runs west almost to Cherokee County and includes ALL of Nacogdoches County, about half of Rusk County, and ALL of Shelby, Panola and Harrison Counties. When you consider that the oil and gas people have a strong VESTED interest in circumscribing the area that the Haynesville Shale entails; ie, they want everyone they're negotiating with to believe the gas field is as small as they can lead you to believe, it potentiaaly enables them to get YOUR natural gas at the least cost. Don't give them YOUR gas cheaply--they have the money, the seismic information, but it's still your gas and they have to come through you to get at that monstrously valuable resource that you own and remember that the real money is in the per centage of royalties that you retain: 25 per cent is good, but 27.5 or 30 is even better! Good luck over in Shelby ounty, Donald. Keep in touch.

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Permalink Reply by Joan Williams on July 3, 2008 at 8:20

I was told that Chesapeake or any other O&GC would not sign a lease giving mineral rights for only the Haynesville Shale zone. It is a good idea to keep your rights to the other gas zones before the Haynesville, such as the Cotton Valley. Then if they wanted to drill the Cotton Valley they would have to come back and do another lease..
But then someone else told me the O&GC would not agree to this.
Any comments ???

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Permalink Reply by Heather on July 3, 2008 at 13:36

Has anyone received any information or offers so far for Marion County or Cass County land and or mineral rights?

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Permalink Reply by btj on July 16, 2008 at 6:35

I have not heard of any offers in Cass or Marion Counties. I did talk to a chk rep today in their office on OK. She said at this time they are not interested in these Counties.

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Permalink Reply by Donald L Ashberry on July 16, 2008 at 12:54

Heather, I have several cousins with lots of land in Cass County, TX. None of them have received any offers. I think Cass is a little too far northwest. Cass is not in any of the Haynesville Shale maps that are 'floating' around from Petrohawk and EXCO Resources. Good luck!

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Permalink Reply by Donald L Ashberry on July 3, 2008 at 15:23

Hey everyone! Go to www.ExcoResources.com and select "Investor Relations". When the selected page appears, select "Howard Weil Energy Conference". Page 11 has a map of what their geologists believe to be the boundaries of the Haynesville Shale. The three articles right above the Howard Weil Conference Report are good reading also. Enjoy!

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Permalink Reply by Alamo on July 9, 2008 at 6:58

Donald,
In my humble opinion you and your brother were wise in the extreme in stepping back and waiting.

Neither the bonus money ($325) OR the 20% are reasonable in light of recent developmnts.

If you consider the simple economics that companies like Chesapeake Energy (CHK) and Plains Production (PXP) have so recently provided the mineral owners in the projected Haynesville Shale (HS) play, their "sharp pencils" evaluated that asset at no less than $30,000 per acre--all 550,000 acres that they have leased! AND CHK IS SCRAMBLING FOR ADDITIONAL ACREAGE! That kind of demand factor has to drive the going rate higher--much higher-- than what your family has been offered.

The $325 and 20% are definitely pre-HS figures. Shelby County is a blistering hot area.

My personal belief is that ALL the mineral owners within the HS should FAIRLY share in the enormous wealth it appears to represent rather than just the oil and gas operators. After all it's YOURS not theirs.

Just last night, T Boone Pickens with EXCO Resources, one of the HS participants, appeared on the CBS News with Katie Kouric and after describing himself as the "world's most knowledgeable oil man", said we need to free up natural gas for use as America's transportation fuel. And what a demand factor that entails. That alone shold be sufficient to offer natural gas pricing stability even in the prescence of the massive reserves of the Barnett Shale, the Fayetteville Shale, the Marcellus Shale and now, the Haynesville Shale. Without doubt the best thing about this is these are all American fuel reserves. We can kiss the OPEC thugs adios forever and help clean up our part of the planet

Ft Worth and the Barnett Shale experience taught us that patience has virtue (and financial reward). Hang in, your time will come and you'll be glad you did.

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Permalink Reply by Donald L Ashberry on July 10, 2008 at 1:34

Alamo, you give me hope. I enjoyed reading your 'words of wisdom'. "Thank you" for your encouragement!

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Permalink Reply by JWC on July 9, 2008 at 12:21

We have land in San Augustine county. We were just offered $300 per acre and a 20% royalty.

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Permalink Reply by Donald L Ashberry on July 10, 2008 at 1:37

Carver, you're just south of Shelby County which is hot, hot right now. Don't do the $300 + 20%. Hold out please. Just sit there, wait and watch this gohaynesvilleshale.com site for developments more favorable to you. You just 'hang in there' for now, please.

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Permalink Reply by JWC on July 10, 2008 at 3:01

Thanks Donald. Really appreciate the advice. Nice to know San Augustine is looking good. We have about 250 acres. Please let me know of future developments down there. I am watching this site.

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