Bonus Offer in Barnett Shale, City of Ft. Worth (For Comparison Purposes)
| DATE: | 9/21/2010 | REFERENCE NO.: | L-15058 | LOG NAME: | 062040 BOTANIC GARDEN |
| CODE: | L | TYPE: | NON-CONSENT | PUBLIC HEARING: | NO |
| SUBJECT: | Approve the Acceptance of a Lease Agreement with XTO Energy Inc., in the Amount of $582,801.68 for Natural Gas Drilling Under 110.988 Acres of City-Owned Properties Known as Fort Worth Botanic Garden Located at 2000 University Drive (COUNCIL DISTRICT 7) |
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| RECOMMENDATION: | ||||||||||||
It is recommended that the City Council approve the acceptance of a lease agreement for natural gas drilling under 110.988 acres more or less of City-owned properties known as Fort Worth Botanic Garden to XTO Energy Inc., for a two-year primary term in the amount of |
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| DISCUSSION: | ||||||||||||
On September 22, 2009, (M&C L-14836), Fort Worth City Council authorized the conversion of Fort Worth Botanic Garden for subsurface A Request for Bid Proposals (RFP) for Fort Worth Botanic Garden was advertised for three consecutive weeks in the Fort Worth Star-Telegram, published on July 15, 2010, July 22, 2010 and July 29, 2010. The following sealed bid for the gas lease was received and opened on August 5, 2010.
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Link to story and map:
http://www.fortworthgov.org/council_packet/mc_review.asp?ID=14135&a...
Tags: Barnett, Bonus, Botanic, Chesapeake, Garden, Lease, Offer, Shale, XTO
Views: 276
Replies to This Discussion
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Permalink Reply by Two Dogs, Pirate on -
KJ it was for the general public and it was before the summer of 2008.
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Permalink Reply by Skip Peel - Mineral Consultant on
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The verifiable leases including $25k bonuses, and a few for greater amounts, covered large urban neighborhood groups primarily in the NW quadrant of the DFW metroplex. The height of the leasing offers in those urban areas occurred from Spring through early Summer of 2008. Some of the group leases included royalties greater than 25%. It was a relatively small window in time where a number of aggressive companies competed to acquire proven leasehold.
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Permalink Reply by Two Dogs, Pirate on
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At the time that DFW airport signed at $10,000, I was siting in Rocky's in Bunkie, LA with a VP of one of the old time Fort Worth family oil companies. When I asked him about the DFW deal he said "That ain't nothing we got a deal at $14000".
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Permalink Reply by Skip Peel - Mineral Consultant on
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That DFW airport lease has been nothing but trouble for Chesapeake. Urban drilling attracts urban politics. Just one more reason to avoid the big city.
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Permalink Reply by Tex Calhoun on -
Yes, actually that's a bit more accurate. Most of the $25-26,000/acre offers were actually made in the Spring and Summer of 2008, but many of the leases were actually signed late Summer into early Fall until the offers were abruptly withdrawn because of rapidly changing economic factors.
My in-laws in a nearby neighborhood signed just before the offers were withdrawn and did very well. My neighborhood association was left holding a worthless, unsigned offer because they didn't/couldn't move fast enough. I had signed nearly 12 months before when the bonus offer was $2500/acre. Some folks thought I was very foolish to deal on my own, but I'm one of the few in the neighborhood who actually pocketed any lease money. And since my lease has expired, I'm negotiating again.
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Permalink Reply by George Lutz on
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Does anyone have an idea how Fayetteville shale compares to Barnett Shale on lease comparison with bonuses and production?
thanks,
GPL
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Permalink Reply by Two Dogs, Pirate on
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Bonuses have gone to crap because of the HS, is what I hear.
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Permalink Reply by LWC on
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Fayetteville Shale leases were always much less than HS or BS, at least up around Heber Springs, Floral and those rural areas. The economy was so poor that people took basically the first offer and a great many times it was 200-400 an acre. Some of my family signed on 160 acres (well before the HS rush) for 450/acre (which was a good lease) but for 5 years w options. They have yet to drill and the lease is up next year. Too many wells to put in and too few rigs is what we've been told. Also the shale is reportedly very close to the surface which makes completion very difficult (I don't know about this aspect but maybe some of you could explain?).
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Permalink Reply by L D H on
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We got $27,500 an acre and 25% in August of 2008. We barely got our draft deposited before the crash. Many of our neighbors got nothing. So far there has been no well. The people who signed early, before the neighborhood agreement, have leases that are about to expire. Our site was supposed to be near Pancho"s at the coner of I-20 and Traillake. Now we hear that this site is off the table and they are looking for another site. It will be interesting to see what happens. People in Fort Worth are not as trusting as they were two years ago.
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Permalink Reply by Frank on
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That makes me feel much better after signing earlier this year. I had fractured, but inviting, acreage around the parish. I can't say what it went for, but I beat the Barnett in 2010. Not bad, IMHO.
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