Replies to This Discussion

Permalink Reply by po boy on August 13, 2008 at 16:56

Petrohawk is rumored to have cancelled some meeting after an email to there local landmen. This is just a rumor.

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Permalink Reply by kittycatmama on August 15, 2008 at 10:38

Supposedly Petrohawk has pulled out of Emberwood and Dixie Gardens in Shreveport. That is current rumor. Can someone verify that? Any other areas they have pulled from?

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Permalink Reply by po boy on August 13, 2008 at 17:12

And of course it' MUST BE TRUE CAUSE I HEARD IT ON THE INFERNALNET!"

What we know for a fact is the gas is there, the market is there,the technology to get it out at a profit is there and we own the land.

Everything else is just noise. 10-4?

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Permalink Reply by Martin on August 14, 2008 at 9:40

Po Boy --
The problem is that at least for Sabine, the available pipe lines are old, and near full capacity. A friend stopped and talked to a couple of guys from Dallas last week that work for a major pipeline company. They are getting ready to line up pipe line right of way for a 42 inch trunk line connecting NW La. to the East Texas pipeline network.

So how long does it take to take a pipeline from scratch to operational? My own guess -- would probably be two or three years. The O&G companies need the pipeline to earn the return on their investment in land leasing and drilling costs. So why should they lease everything in sight when it won't be able to go to full production for another two to three years? Then there is the problem of getting enough rigs to drill the leases they already have.

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Permalink Reply by Gone Fishin on August 14, 2008 at 10:12

According to cpk they have already been planning for the pipelines etc. long ago. Some of the smaller companies very well may have problems in that area. Remember, they dont intend to produce all they can. They will drill to hold the leases and then sell the reserves.

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Permalink Reply by po boy on August 13, 2008 at 17:29

Piece of advice I recieved when I was young from someone who at the time was on of the richest men in the world was"Play dumb,ask stupid question and do not outsmart yourself." oh yeah "and buy silver-lots of silver"
No one can cheat you unless you let them.

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Permalink Reply by Thomas T. Thomas on August 14, 2008 at 2:48

Was his last name Hunt? Nelson Bunker Hunt?

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Permalink Reply by po boy on August 14, 2008 at 10:21

I think you know the answer.

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Permalink Reply by hoover182 on August 13, 2008 at 18:32

I have mineral rights in Blanchard and had offers from two different companies retracted in the last week. In the past couple of days there are stories all over this website about offers being instantly yanked away (the one about 2 vs. 2.4 million was especially brutal).

What exactly is going on? Regrouping and refinancing for another phase of leases? Forced pooling (how this affects lease bonuses being paid, if at all, is still not clear to me)? Or have these companies simply leased all they can drill for the next three years. I sure hope this becomes a bit more obvious soon.

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Permalink Reply by Bobi Carr ("parker") on August 13, 2008 at 20:15

They are not going to force pool anyone that they can do anything else with. They would leave too much money on the table.

This is just probably another one of their scare tactics.

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Permalink Reply by TCB DS3 on August 13, 2008 at 20:37

Everyone take a few minutes and listen to the CEO of CHK vs seeded rumors "landmen leaving or leases drying up" for the value of the HA play and its leases. Go to http://podcasting.thomson.com.edgesuite.net/2008/July/CHK/CHK080108....

You will learn the actual numbers and science behind CHK's activities, their two years of prepartions for this play, the long term steel tubular pipe contracts they entered into to make certain they had plenty for rigs, even have a CHK boardmember who is the CEO of a tubular pipe company, their long term gas line space contracts, the fact that they will not have to pay to pressurize HA gas because it is coming up at 10,000psi, the fact that CHKs total conservative cost including $30k leases is expected to be no more than $2mcf and their five year plan to keep gas prices stable although there will be at least 5% more gas moving in the piplines during the next two years.

The CEO even lays out how they are financing this play and how much gas their eleven wells--one 300 days of production are producting. Oh, and the the first item CHK states they needed for this play "land".

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Permalink Reply by Ladyoaks on August 13, 2008 at 20:48

Folks-

My two cents. I simply think Petrohawk and Chesapeake are focusing their efforts on areas where they have the most research.

My expectation is that what is apparently becoming the heart of the play, Caddo, Bossier, DeSoto and Red River parishes (probably missed a few) still has significant amounts of "scraps" on the table. Rather than having landmen chase around for significant leases in outlying parishes that may or MAY NOT be significant reserve areas, they are having their people focus on cleaning up the scraps that are still out there.

This view was basically what Petrohawk's CEO said on the earnings call in which he said that they would be "strategic" in their leasing and not simply go out and try and lease up as much new land as possible. If you look at how much these companies have raised over the past few months (Billions), then you would realize leasing up (especially at the new 20K+range) is expensive.

I think we see retrenchment for a few months, and then the expansion will continue again to newer areas. Patience is a virtue!

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