Replies to This Discussion

Permalink Reply by jffree1 on November 18, 2010 at 10:36

Durn, I thought you would have something interesting:-). CHK and Crimson are both still drilling... that's all my news.

Permalink Reply by Frank Coday on November 18, 2010 at 11:13

Waiting on a new budget year for the companies , hopefully $ 4.50 to $ 5.00 gas, and for the powers at be to get on with policies to maximize this most valuable domestic resource.

Permalink Reply by Jon Williamson on November 18, 2010 at 11:49

In Dallas today saw a UPS van....painted bold on the side "Powered by clean natural gas" oh what could be.

Permalink Reply by jffree1 on November 18, 2010 at 12:13

Well, that is some encouragement! Do you know how many trucks Brown has? I don't but they need to switch them ALL! Now, if they could just get the aeroplane angle figured out...

Permalink Reply by Jon Williamson on November 18, 2010 at 13:43

Qatar Airways has done it http://www.usnews.com/science/articles/2009/10/13/qatar-first-to-fl..., 10 years from now may be our only option

Permalink Reply by GoRicky on November 18, 2010 at 20:04

I've been entertained on a few tracts (San Augustine & Shelby Counties) lately. The offers are in the
$1-$2K / acre range, but the offers are so bare-boned, they barely pass as contracts to drill & produce O&G. A few basic protections are missing. The > reasonable demands of mineral owners are over. I heard the Big Dog of Range Resources say (I believe) that there may be 100 times as much gas in the Marcellus as opposed to the Barnett. The large companies are obviously looking to the Marcellus (and Eagle Ford 'liquids rich' play) regarding the future of their companies. They have HBP'ed Tens(Hundreds?)-Of-Thousands-Of -Acres of Haynesville / Bossier Shales, forming LARGE units that include plenty of acreage to re-dill due to increased density, in the future. The current price of gas stinks & the ONLY reason SOME companies are drilling the Bossier/Haynesville is to HBP more "proven reserves" that make their stocks look good & that they will access / produce when temporary gas prices experience a "bubble". Otherwise, they are looking elsewhere. Witness (apparently) Range Resources doing some kind of deal (simply selling?) with Chesapeake (“CHK”) such that CHK has taken over the two Bossier-Haynesville permits such as the:
a) Horton Federal #1H and
2) Frazier Federal #1H

It simply gets down to the price of gas and the expense to produce it. It may take several years for the natural gas “hangover” to last. I’ve hear that service companies (landmen. lawyers, surveyors, location builders, drilling companies, the price of casing / liners, fracing companies, haulers, insurance, etc…) have hit what they call “rock bottom” on these services, and have actually increased their fees, hoping to pay-out “down-time” to their trained staff. They are hoping things will turn-around and these semi-laid-off employees will come back. The only joker in the deck is the INSURANCE. I believe this to be an over-priced security (or service).

My gut feeling is that successful operators and royalty owners have to realize that in order to make money for all, bonus has to fall; IF a lower royalty percentage (or fraction) is granted – good; steel / contract/ labor costs have to go down IN ORDER TO MAKE THE BOSSIER / HAYNESVILLE competitive with other, more lucrative domestic plays like the coal-seam and shale plays developing now…. There are armies of sharp-penciled accountants that sometime “rule the roost” and make decisions that other professionals would normally make. Just a thought…please excuse any typos -+-+-+

Permalink Reply by Fred W. Smith on November 19, 2010 at 5:16

Sure has been quiet. I guess being the end of the year and gas prices staying down have slowed progress. Lots of activity still in San Augustine and Shelby County though.

Permalink Reply by Jon Williamson on November 19, 2010 at 21:56

The players are heading for the Eagle ford and the Marcellus, getting away from dry gas. We just need the economy to stay on it's upward trend, output of course, jobs are a different story. Natural gas will come back.

Permalink Reply by Sarah on November 20, 2010 at 10:56

Thanks for being the voice of hope today Jon. Yes, Natural Gas will come back. After we get a conservative in the White House again.

That's good news about UPS! Same with Quator Airlines except the part where they get their natural gas from a pocket reserve they share with IRAN.

jfreel, thanks for the update you had as well.

Permalink Reply by Ewing Walker on November 22, 2010 at 5:14

I own shares of NYSE stock, Sabine Royalty, SBR.
It is a leftover of Sabine OIl company which merged years ago.

Does anyone know if they have any royalty where there is shale.
Could be a real mover. Pays a nice dividend, etc