Replies to This Discussion

Permalink Reply by ETOilman on August 25, 2008 at 3:02

Well it is unfortunate that the landmen in the HS are not playing a fair game. Probably the best way to handle the bonus and terms of the lease in this play is to form a "neighborhood" association and have all in a certain area agree to the terms that are acceptable and put out for bids. That way you can assure that all are getting the same deal. And besides, it would be a great way to meet your neighbors. I know that this is being done and it seems to have worked well in other areas.

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Permalink Reply by Bobi Carr ("parker") on August 25, 2008 at 4:28

For the most part it is over in my case. I leased a large piece of property a year ago.

I only have a few acres unleased, but I am working with a group.

THANKS

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Permalink Reply by Iris on August 24, 2008 at 11:04

thx for answering I thought they might be somebody important ...what is E & P.?

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Permalink Reply by ETOilman on August 24, 2008 at 5:11

You are on the money there Jim. I honestly never thought that the lease acquisition costs per section would almost rival the cost of the initial well. I had grown accustomed to the land department being the whipping post for expense cuts.

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Permalink Reply by KT on August 24, 2008 at 5:39

To justify the expense the potential payoff must be large enough to make it worthwhile. This country will go for natural gas vehicles. I will buy a CNG vehicle as soon as it becomes practical. And that will be very soon. If all goes as anticipated the demand for NG will be much larger than today. It may take ten years but I can wait.

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Permalink Reply by Grice on August 24, 2008 at 6:43

I have not read all 6 pages of this thread, so I do not know if someone has mentioned it already, but there are two proposals in the works. Those proposals would offer tax relief for NG car manufacturers, and NG fueling stations. These are in response to the reports of declining current resources. If legislation is adopted, the demand for NG is anticipated to rise considerably. Reports already demonstrate our current suppliers of oil is declining. I believe one report indicated Mexico has declined 8% in the last 5 years (I may be inaccurate with the exact figures). With the continuing "push" for a more environmentally conscience world, the need for NG becomes increasingly popular. Of course, this is expected to be met with great opposition. There is no guarantee of the future, but by forecasting future demands, one can see where the market may be heading. A good indication would be to watch what the CEO's of the O&G companies do. With Mr. McGlendon recently purchasing $42 million of stock in Chesapeake, as the market value is in a decline, shows his anticipating for the future of NG. Either he is a very bullish investor, or totally out of control of his mental capacity. You decide.

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Permalink Reply by ETOilman on August 24, 2008 at 5:56

In this play, 20 net acres for $100K is a good deal.

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Permalink Reply by RAY on August 25, 2008 at 4:50

you mean $400k dont you??

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Permalink Reply by Iris on August 25, 2008 at 4:57

Ray, since Jim Mc pulled all his comments I'm not sure I think they were talking about some kind of brokering fee....I was puzzled 2, think there were additional comments before Jim Mc pulled...

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Permalink Reply by ETOilman on August 25, 2008 at 4:59

This was in reply to an answer provided by McConnell who apparently has decided to not post here any more. He was talking about landmen costs being about $100K for 20 net acres in a subdivision. The thread was about how expensive it is to lease a subdivision. I merely stated that 20 net acres for $100K ($5000/acre) would be a good buy in the HS.

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Permalink Reply by Bobi Carr ("parker") on August 24, 2008 at 12:59

You can always negotiate a lease after being force pooled.

If it is a good well and you want the protection of the lease, why not lease after the well is drilled?

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Permalink Reply by Bobi Carr ("parker") on August 24, 2008 at 19:49

As a small acreage owner, would you have any luck at $0 and 30%?

Or something like a 25% then 30% after well pays for itself?

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