Replies to This Discussion

Permalink Reply by William Rice on October 16, 2008 at 17:25

If CHK is not still serious why did they borrow almost half a billion dollars today, announcing it was to finish developing their fields and construct pipelines to them? This brings to mind another question. Why would someone loan them that kind of money in this business environment unless they thought they could make some money themselves?

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Permalink Reply by Grice on October 16, 2008 at 17:45

They have not actually borrowed the money. The have secured a line of credit, that will last for 5 years. What they do with that line of credit, within the 5 years, is still debatable.

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Permalink Reply by Ben Eagle on October 17, 2008 at 10:06

Mr. Stewart:
Humm, your post totally misses the point given the practicality of Mr. Davis’s post. I don’t and never thought this play will back off to the $00/ac. given the nature and the largeness of the reserves. Most of your recent post was devoted to the joint venture aspect of Mr. Davis’ post. The joint venture idea (between farmer and operator) is a non starter and not going to happen. I agree, totally. But you being a quasi oil guru, (soy bean farmer) thinking your land to lease is worth $40-$50K (in 3yrs.) makes me think just because you heard Papa Wilson say so is edging on the land of Terabitha. My point all along since my first post is that some of your brothern (maybe you) waited and squeezed and squeezed for that $7k plus or minus, when the land was worth $2-3K at best on the fringes. And yes, for the most part the fringes have been defined, I too, am a soybean farmer. Because of the squeeze technique, (greed) the train has indeed left the station. I can wait also to lease them in the future for a lot less given the mentality I have experienced

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Permalink Reply by Snake Stewart on October 17, 2008 at 12:18

Sorry about missing the practicality of his post . I got sidetracked with the '00's thing.What was it again that was so practicle for me ? You sent me to the post and then dispute the astuteness of it that you spoke of.You spoke about bonuses and future of prices in the play.That is what I got so tickled about.

(QUOTE from Ben Eagle)Go to the group section (Natchitoches Parish) and then to the first discussion (Messenger flow rate) group and read Mr. Davis' s post. This very astute comment was spot on pursuant to the bonus prices and the future of the prices in this play.

Would greed allow me to not ever lease or care if I see a rig ? That is ridiculous of you to confuse greed and common sense the way you do.Just because the internet has made "quasi oil gurus" out of common people, dont let it bother you so much.It isnt your bean field that I am baseing my knowledge against.
By the way, since you state you are a bean farmer (fellow quasi oil guru), tell me where I can find the info that you are spewing about acreage values. Please dont tell me it is just his opinion that is driving you. You do sound full of gas and I do not feel that it is coming from "your soybean patch". HA!HA!
Have a good one Mr. Eagle and good luck with your next quasi oil barron! Maybe he will be a sucker.

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Permalink Reply by Spring Branch,mineral owner on October 17, 2008 at 3:07

If you drive around Chesapeake's primary area of current drilling emphasis, which would be 16/16, 16/15, 16/14, 15/16, 15,15 (wells drilling or permitted in 18 of the 36 sections in 15/15), west edge of 15/14, you will clearly see exactly what Chesapeake Midstream Partners, L.P. intends to with that line of credit! They intend to build a pipeline gathering system with it! In the townships I mentioned above, there are by my count a minimum of 52 wells producing, drilling or permitted and there will be many, many more over the next 12 months. Chesapeake has the pipeline construction companies, surveyors, foresters, timber companies, etc. running around the area like a hoard of invading armies. It is amazing to me to see the pipelines that are being constructed everywhere I look. I understand that the credit crunch together with the falling price of gas will slow progress in the Haynesville down somewhat , but from what level? From what I can see the doubting Thomases need to get in their car and drive the roads in 15/15. Drive the Keithville-Keatchie Rd, Preston Rd, Williams Rd, Vardeman Rd. , Stonewall Rd. and see for yourself. Chesapeake will clearly move forward with this play. They know how to do it and have done it before. and if they don't do it somebody else will!

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Permalink Reply by Bobi Carr ("parker") on October 17, 2008 at 4:04

Spring Branch,

I would consider myself a hopeful more than a doubting Thomas but there
have been many on here that have stated that their pipeline negotiations
have been put on hold. I look forward to the frenzied pace that we became
accustomed to. And if Chesapeake is doing most of the pipelines, why don't
they construct a saltwater pipeline at the same time. Bossier Parish is
considering this as a requirement.

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Permalink Reply by Bobi Carr ("parker") on October 17, 2008 at 17:41

Jay,

My understanding was that the pipeline would be a way to transport the frac water to and from locations to lessen the impact of the frac trucks.

It was mentioned briefly at the Bossier Bar event.

I don't know if this is feasible or cost effective. I'm sure that it will be researched thoroughly before they would enact it. Patrick Jackson, the Parish attorney, is the person who spoke about it. He said that the Parish is trying to find ways to be proactive before problems develop.

Since I do not understand the fracing process, I cannot speak intelligently about it.

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Permalink Reply by Bobi Carr ("parker") on October 18, 2008 at 4:07

Jay,

The discussion at the Bossier Bar event pertained to the frac trucks and the damage that they do to the roads. Mr. Jackson stated the speed at which these trucks damage roads.

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Permalink Reply by Spring Branch,mineral owner on October 17, 2008 at 21:40

Parker, I can't address what other folks say regarding their negotiations with pipeline rights of way because I have no personal knowlege of their particular situation, location , or the companies involved. I just know what I know and that is: in Southwest Caddo Parish pipelines are being built everywhere, primarily by Chesapeake but not exclusively. Camterra is drilling a horizontal Haynesville in 15/14, Section 9, and had a had a pipeline right of way with 6 inch pipe in the ground before the well reached 5000'. Chesapeake has just doubled the width of an existing pipeline going N/S across my deer lease and put a 16" pipe to go with the 5" that was already there. I understand that the plan is to lay two additional large pipes in the same right-of-way. Chesapeake currently has 14 rigs working in the Haynesville and more will be coming. They are not going to drill wells and not have a way to market the gas. I know this is elementary, but the cash flow comes as a result of gas sales......pipeline reguired.

Running pipe to every well being drilled to provide frac water doesn't sound very feasible to me.

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Permalink Reply by Bobi Carr ("parker") on October 17, 2008 at 21:48

Spring Branch,

I think that the frac pipe that was spoken about at the Bossier Bar event was discussed as to the property inside the city limits. At least that was my take on it. It was not discussed at length.

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Permalink Reply by Coonman on October 17, 2008 at 5:18

What happened to Lone Star?

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Permalink Reply by Cathaus on October 17, 2008 at 18:40

Lonestar disappeared the same as the gas that was under your dirt!

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