Does anyone know for sure what happens if we do not sign a lease? I'm told we would get placed into forced pooling (consent or non-consent). Some say forced pooling could equal 100% royalties? Some say they can give you as little as 3/16 royalty? I've heard you can wait forever to receive your royalty money and there are costs and legal issues you could be liable for? What's the real deal with forced pooling?

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I don't believe that every well will produce $122,000 per day either but to compare this play with the Barnett is a difficult task.I do not feel we have enough detail to even show outer edges yet much less how variable these wells will be. We are in somewhat unchartered waters with this play. Time will tell the story.Mr. Les B has an insight that most of us don't have but when you are sitting in the number one N/G field in the country it seems the former rules may have to be rewritten somewhat.
3/16 royalties = 18.75% royalties without the acreage bonus.

Unless I believed in black helicopters and wore a tin hat, I'd join in with my neighbors instead of hoping for a better deal with "forced pooling".
Johnson, initial information indicates the Haynesville Shale quality is very consistent within the primary region (3.5 MM acres?) with only some variation in thickness (~ 150' - 300'+). This is the only shale play that seems to have this consistent quality. Plus the Marcellus Shale has a lot of issues with topography (very hilly) and water access and disposal.
Thats why you are the man Les B , I humbly bow. Have a good great weekend , I'm hitting the sack.
I sent an email to the Department Of Natural Resources and got the following reply. If you follow the instructions there are eight pages that refer to pooling. It's still a little vague but it supports most of what has been discussed in this forum.

If I understand it correctly if I don't sign I am responsible for the costs of the well as it pertains to my small 1/3 acre of land. I heard an estimate of $7,500 but not sure if that is per month or per year. There is also a “supervisory fee” plus liability for any problems that may arise as it pertains to the well (lawsuits, damages etc) which is hard to put dollar figure on. There is also a delay for payment (I believe).

Anyway I attached it for those who are interested and can decipher legal mumbo jumbo. My intention is to parlay a small amount of land (25 rental houses comprising 7 to 10 acres in Bossier City) into something potentially significant. I thought I’d apply the “Bigger the risk, the bigger the reward” theory but will probably line up with all the other sheep and inevitably sign.

Response From DNR:

Your e-mail has been forwarded to me for a response. "Forced pooling" is a term used in unitization. A unit is a theoretical combination of multiple tracts of land that is treated as a single tract for the purpose of oil and gas development. "Forced pooling" is the legal concept that allows the owners of these tracts of land to be entitled to share in the production or proceeds of production. Generally, the participation in the unit is based upon the surface acres of each tract of land included within the unit boundaries.
The statutes that deal with unitization are LSA-R.S. 30:9 and 10. You may review these statutes by going to, then click on Louisiana Laws, then click on Revised Statutes, then click on Title 30 and then scroll down to 30:9 and 10.
However, this is for general information only. Therefore, the best advice that we can give is that you consult with your private attorney or an attorney experienced in oil and gas law so that he may give individual consideration to your specific situation and properly advise you. .
J Stewart, excerpts of Louisiana RS 30 and links have been posted in several discussions of unitization and force pooling since it is the primary law addressing these issues.

The upfront cost for the 1st well would be ~ $9,000 to $10,000 per acre. But the 640 acre section will likely have eight wells when fully developed plus surface facilities so the total capital cost may be on the order of $78,000 per acre. This total cost may be spread over 3-5+ years dependent upon the pace of development. None of these costs include the day-to-day operating expense which would an additional item.
One more queston Les.....

If the first well is a'd pretty much be out your investment? Correct? Because they wouldn't drill anymore in your section?

If the first well is a solid producer then they would drill more wells?
I think this is a very good point. The only way your capital cost would reach the $78,000 range would be if there were a series of successful wells already drilled in the unit. All along the way the capital costs associated with the 100% working interest would be increasing, but so would the value of that 100% working interest.
And in theory you could pay the cost of the future wells from the production in the first well?
Makes sense to me.

If you're doing consent, you would have paid your share of capital costs on the first well, so you would participate in the production of that well from day one.

If you're doing non-consent, your costs would recouped well to well, so you might not get any revenues until all the wells have been drilled, depending on how quickly the E&P drilled all the wells.
Johnson, looks like you and Skidmark pretty much figured this one out with no help from me!!
Can you add anything to our discussion? I'm trying to gather as much information as possible. So any input is welcomed.


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