Replies to This Discussion

Permalink Reply by BirdDawg, plain ole' idiot on October 9, 2008 at 8:51

Grice,
Chesapeake just backed out on one hundred million dallar deal in west Bienville parish. HBP properties. This happened Monday. This is not speculation, rumor or personal opinion. Just cold, hard sad fact.

Permalink Reply by RJ on October 10, 2008 at 10:50

Adubu,Maybe you need to talk to JPD energy and tell them that they cant pay the Drafts they put out because you heard CHK was out of money. Then let us know what they tell you before you get on here and tell everyone that CHK has stopped their Drafts.

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Permalink Reply by Bill G on October 9, 2008 at 6:37

WoW! That is crazy, Jim your business slowed down any?

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Permalink Reply by crazycat on October 14, 2008 at 6:15

My cousin has a house in North Bossier and just got paid 9,000 per acre and signed this week from CHK for a pooled lease on his property. He has signed with 25% royalty.

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Permalink Reply by ker on October 23, 2008 at 9:18

I signed my lease the last week of Aug. The amount was ammended, so the original draft was cnxld, a new one was issued, and my bank overnighted it to the O & G co's bank, they recvd the draft via my bank on 10/6 (payable in 10 days) I just got the funds wired yesterday 10/22. It was late, but I got it! I was getting nervous. Relatives that own the other undivided interest on this same acerage were offered at least 2K per acre less than me 2 wks ago, and then after procrastinating a week or so, they were told Chesapeake was not leasing for the time being-nadda! On top of that, several of the landmen that worked for the broker I leased through were laid off, including the person that signed and sent my draft(s). I had to bark at CHP's head office in OK to be sure my check got all the necessary signatures, and wired instead of 7-10 mail. After the CEO of CHP had his shares forcefully liquidated on a margin call ( I believe 34 million shares) & CHP TV was caancelled I was getting nervous about being paid in a timely fashion. Too much $$ has been invested in this venture, it has just slowed for now. I think the fact that the lease was signed back in late Aug. had a lot to do with it being paid (the draft funds had already been allocated by bookkeeping in Aug., if they do their books the way normal businesses do, this $ was already paid)

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Permalink Reply by smith1 on October 23, 2008 at 9:26

You are indeed fortunate; and your draft wasn't too late, considering it's 10 payable BANK days, not holidays, weekends. etc.
Fabulous for you!

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Permalink Reply by Gone Fishin on October 9, 2008 at 3:28

My aunt just got a letter asking to allow sizemic testing and test well work. If they're not leasing why do more sizemic and testing.

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Permalink Reply by Sue on October 9, 2008 at 3:52

Technology fuels natural gas surge Increased production in Louisiana and Texas should mean lower prices this winter.
BY RICK PLUMLEE
The Wichita Eagle

Production of U.S. natural gas is surging at a pace that hasn't been seen in this country in half a century.

New technology has allowed producers to release gas trapped in mammoth shale beds throughout the country.

One of the largest is known as the Haynesville Shale in Louisiana, which only began producing in January.

The Barnett Shale -- one of the nation's largest fields at 5,000 square miles -- covers part of Dallas and most of Fort Worth.

The net result is production of natural gas is up almost 9 percent over last year, a jump that hasn't been seen since 1959.

"That's a phenomenal story," Steve Feilmeier, an executive vice president and chief financial officer for Koch Industries, told the audience Tuesday at the Wichita Area Economic Outlook Conference. "The natural growth rate in the last 10 years has been zero."

Increased production also means lower prices. And at a time when there is so much sour economic news, this strikes a sweet note for the nation's businesses and individual consumers.

After reaching almost $14 per million BTU this summer, natural gas dipped earlier this week to just under $7 for the first time since February.

"That's good news," said David Dayvault, chairman of the Kansas Independent Gas and Oil Association. "What consumers saw in the summer gasoline prices, they're not going to see in natural gas prices this winter."

Prices have fallen enough that Chesapeake Energy, one of the nation's largest natural gas producers, announced last month that it would cut its budget for drilling by 17 percent (about $3.2 billion) through 2010.
But Feilmeier said the drop in prices isn't all bad news for the producer.

"Prices can't fall (too far)," he said, "because this is expensive technology. It costs a lot of money to drill under Fort Worth."

And drilling under that city is literally what's happening. Using horizontal drilling technology that wasn't commercially available until six or seven years ago, producers go 1 ½ miles down and then a mile horizontally to reach the natural gas.

The gas has always been there, but conventional vertical drilling wasn't releasing it in significant amounts, if at all.

"The gas is not vertical," Feilmeier said. "It's embedded in a horizontal layer. This technology has opened up a whole new world of drilling opportunities in this country."

Richard Smead, director of Navigant Consulting's energy practice, said the U.S. has 2,247 trillion cubic feet of natural gas reserves, which is enough to supply the nation at its present consumption rate for more than 100 years.

Of that amount, 842 trillion cubic feet is expected to come from horizontal drilling of the retrievable shales around the country, Smead said.

The Barnett Shale has proven to have 2 ½ trillion cubic feet of natural gas and is widely estimated to contain as much as 30 trillion cubic feet.

The Forth Worth Chamber of Commerce says the urban drilling has created more than 50,000 jobs and will pump more than $1 billion in tax revenue into the city's economy.

Kansas isn't a big player on the national scene for natural gas. Production dropped nearly 50 percent from 1995 until 2007, when it fell to 37.2 billion cubic feet.

The state's claim to fame in the industry rests with the Hugoton Field in the southwestern corner, but that site's production has diminished significantly since it opened in 1928.

Dave Newell, a petroleum geologist with the Kansas Geological Survey, said the state has significant natural gas activity in the state's coal beds, mostly in the southeastern corner.

"But it's not nearly enough to offset the decline in Hugoton," Newell said.

Chances of Kansas making a jump in production with horizontal drilling aren't good.

"We just don't have that thick shale in Kansas," Newell said.

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Permalink Reply by Grice on October 9, 2008 at 4:28

Sue, you emphasized "Prices have fallen enough that Chesapeake Energy, one of the nation's largest natural gas producers, announced last month that it would cut its budget for drilling by 17 percent (about $3.2 billion) through 2010." Part of the decision may be related to gas prices, but the lack of equipment and skilled workforce should also be considered. While progress is tied in with gas prices, that should not rule out other factors.

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Permalink Reply by Mark on October 9, 2008 at 4:32

Don't know the percentage but the gas price is the biggest part. You don't here them emphasize much else. You can throw money at the other 2 issues you mentioned and get them solved relatively fast. Don't anybody fool themselves...it IS the gas price that well affect this thing.

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Permalink Reply by Grice on October 9, 2008 at 4:37

And, I respectfully disagree. Financial statements tend to be less supportive of your suggestion.

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Permalink Reply by Mark on October 9, 2008 at 3:58

Word is CHK is laying off 1/2 its Twin Cities staff, they have rescinded their offer to purchase (1/2 billion +) the HBP'd deep rights on 10 of thousands of acres in Shelby County, Texas and they have gone non responsive on agreed upon smaller transactions.

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