I just heard that no company bid on Shreveport and Bossier City owned property. This financial crisis is bad news for the Haynesville Shale

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Did the city have minimum terms? That may have an impact as well. I know some gov't entities like to utilize bid rules to dictate minimums or other things. Like the DFW airport bid for the Barnett. One of the bid rules was that you had to utilize 30% minority owned businesses in your work or have a partner that was minority owned. Just a littel social engineering via the bid rules. My former company did not bid on that property because we couldn't guarantee that there were qualified minority owned companies to do the work. I was happy because I oppose affirmative action like this. CHK actually is working through a lawsuit with its minority owned partner/contractor because they didn't give them enough work. CHK says they gave them the work but they were inept and couldn't do the work or wouldn't submit proposals for the work. The contractor played the race card. Haven't heard what happened in the suit. Probably settled out of court...payed them off to go away.
way,way,way off topic!!!
I guess the Dallas Cowboys had something to do with it also.
Mark, the last I heard the city had posted a minimum bid at $22,500. per acre. This is probably what killed their attempt to lease. The O&Gs are not paying this amount any more. I think the city had started with more than this but dropped it before opening the bidding. This may be an indicator of things to come.
I would not say it is bad news for the haynesville shale in particular. because it was there before we or monetary power was concieved. I would say it is bad news for government bodies anticpaiting and savoring the financial injection, as an adict would crack.
Well, it is in fact bad for most people associated with the haynesville shale. Companies will not have money to pay lease bonuses, no money to drill, demand for natural gas will likely drop as unemployment rises. The only folks it will be good for are those that are sitting on boat loads of cash. It will be like the 30's in the East Texas Oil field here. The courthouses will soon be flooded with mineral deeds.
Without lease money and money to drill, the costs of N/G could rise because it would force us to kill our dependence on foreign oil quicker than anticipated.Granted , the current players will look somewhat different.Mergers and hostile takeovers by stronger groups willing to suck up the debt of these troubled companies you refer to will change the landscape.

That 700 billion a year that we are paying Saudi and the other Arab nations will help tremendously with the energy crunch if focused in the right direction.It will also create jobs that will help lower unemployment.If you feel that the current market trend cant be turned around then it really doesnt matter if they continue leasing or not because there wont be any food to spend all your lease money on anyway.Civil unrest will be the norm and things will head south from there in a hurry.

Or you could hope that our country is strong enough to right itself and start digging itself out of this deep hole we are in.We are facing difficult times but dont sell the farm just yet.
I think you are on the right track. Go look at the stocks and debts of the big HS players...CHK, HK, DVN, etc. They are all down big time, 30-40% over the last 6 months, HK is down 70% over the last 3 months! This is big. In addition, prices are way down and the capital market is frozen. This economic meltdown is having a huge impact on the players in the HS and will result in a huge slowdown. It ain't going away, as others are saying, but its not going to go as fast as it was and I seriously doubt you'll see lease prices where they were. The prices rose due to intense competition and I don't think you'll see that intensity level again. It will go back up, just not to where it was.

Then there are companies like XOM, who are sitting on boatloads of cash. Today, XOM has over $50 billion in CASH sitting in the bank. Heck, they are a bank! They could buy CHK, HK, EOG, APC, and 4 or 5 of the minor HS players OUT OF CASH THEY HAVE IN THEIR BANK ACCOUNTS!!!!! Good news is that XOM would bring some stability to the area and a good operating record. Bad news is that XOM does what XOM wants to and at their pace. They are the proverbial 600-lb gorilla!!
Mmmarkkk......You are right about xom.....if they want it they get it. If HK, CHK, EOG, APC,etc continue to loose in the free markets...these companies will be begging to sell there existing assets to xom. Take HK for example this company was at 50+ a share strictly from speculation. When there earning statement comes out they are toast. No one wants to invest in a company with a dept to equity ratio as these guys. Everything is speculation when you are dealing with exploration companies.....especially those that target New exploration areas like CHK and HK. In a volatile market like we have at this time people are not going to invest in risky companies like these, they cant afford to because they are loosing so much money in companies with secure hard assets already GE, Wells Fargo, John Deer, Etc. These guys just put all their chips in at the wrong time. You will see this area (HS) be developed in the future. You may not see the 25% royalties and the huge lease bonuses that you have seen in the past but you will see the activity. You will also here people out there say that they want except anything less than X amount. Well let me tell you this.....when Xom or some company alike takes control of this play you want have a choice. You will either sit on your fortune and be greedy and never have an opp to make the money or you will take it and like it. If this economy keeps heading in the direction it is going you will be crying for some one to give you money for your land and gas. Those that had the chance to lease for that big money and who were greedy are kicking there selves and should be! Could you imagine having a few Million to put in to this market when it does it bottom...and it will hit bottom...You talk about make some serious change!
Maybe the October leasing isn't over...... from DNR page...

October State Mineral Board Meeting and Lease Sale to Reconvene: Due to the large volume of nominated tracts and bids received for the October 2008 lease sale, the October 8, 2008 State Mineral Board Regular Meeting and Lease Sale has recessed and shall reconvene on Monday, October 13 at 9:00 a.m.
Special Notice

Due to the disruption caused by Hurricane Gustav, the regularly scheduled meeting of the Louisiana State Mineral Board, set for September 10, 2008, has been postponed.

Both the bid deadline and the lease deadline for the tracts advertised for the September 2008 lease sale will now be the same as the bid and lease deadline for the October 2008 lease sale. All sealed bids submitted for both the September 2008 and October 2008 lease sales will be opened and read at the regularly scheduled October lease sale, scheduled for October 8, 2008.


I wonder how many of those bids were originally scheduled for September, before the abandonment of lease offers, and how many bids are original scheduled for October. Also, do you think any of the bidder forfeit the application fees, and just cut their loss?

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