Replies to This Discussion

Permalink Reply by The_Baron on August 10, 2009 at 9:44

Its called...North of I-20 is less than great shale, outside the CHK core, and not wanting to pay delay rentals. (or maybe they just forgot to pay delay rentals....)

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Permalink Reply by The_Baron on August 10, 2009 at 9:48

They would have had to pay $15,007,500.00 in delay rentals.

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Permalink Reply by Mattie on August 10, 2009 at 10:49

Baron or Skipper,

Are the delay rental payment requirements also of record?? I'm surprised that CHK or others would be willing to pay that much for a lease with that kind of a delay rental obligation each year - especially if any of these lands were actually on Cross Lake.

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Permalink Reply by Skip Peel - Mineral Consultant on August 10, 2009 at 10:56

Mattie. These leases cover the bed of Cross Lake. I did not spend the time to read the leases in full and trust the Baron on his comment concerning the delay rental. Those terms would be included in the leases filed for public record.

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Permalink Reply by Mattie on August 10, 2009 at 11:04

Amazing that they would have those high of delay rental obligations on the beds of Cross Lake, don't you think?

Have all lands north of I-20 been shot down by CHK and others? I have family with land less than 1/2 mile north of I-20 off Pines Rd. Curious as to whether they are looking to let this go as well.

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Permalink Reply by Skip Peel - Mineral Consultant on August 10, 2009 at 11:19

I don't have an opinion on the amount of the delay rentals. As to the prospective nature of minerals north of I-20, it depends on which stretch of I-20 you are referring to. The stretch from the TX. state line to downtown Shreveport has a good HA well north of it in Section 13 -17N -16W (near the American Rose Center). Petrohawk's Herold with IP of 11.171 MMcfd. Petrohawk has three other HA wells drilling in 17N -13W. These wells are south of I-20 by about three miles only because I-20 is bending northward as it goes through Shreveport and Bossier. To be more accurate I think that in the short run all of the 17N townships will be considered perspective 16W to at least 10 or 9 West. The prospective nature of the 18N townships is more questionable at this time. I expect much of those townships to be productive to 10 or 9 W also. The production may be lower than townships to the south but the shale is there and the operators will figure out how best to produce it.

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Permalink Reply by The_Baron on August 11, 2009 at 7:58

See my response below, but delay rentals are provided for in the stanard state lease form.

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Permalink Reply by The_Baron on August 11, 2009 at 7:57

ALL State leases or leases done through the mineral board have a delay rental (also mant south LA leases are delay rental leases as well).

The Delay rental is 1/2 of the bid amount. To be presise, the bonus you see reported by the mineral board is actually a bonus plus the first years rental. I could write several pages about delay rentals, but in general they are to be paid each year that has no drilling throughout the primay term. With a state lease, you are required to pay the rental or release the lease. If the rental is not paid, and the release is not filed (within 90 days i believe) severe fines are imposed by the state ($100/day I believe).

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Permalink Reply by The_Baron on August 11, 2009 at 8:03

This is a copy of the delay rental clause, for privacy I have blocked out the $$$ amount. There is about a page of rules on how and when and where to pay the rental.

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Permalink Reply by JHH on August 10, 2009 at 9:49

Amazing!

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Permalink Reply by J. A. on August 10, 2009 at 12:19

we are leased by chk in 17 15 sec17

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Permalink Reply by Skip Peel - Mineral Consultant on August 10, 2009 at 12:26

J.A. Though you are leased to CHK I suspect that Petrohawk will be the operator to develop your area. You should be fine.

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