I am trying to find out if anyone has started any talks with these guys as their infrastructure is in place(pipeline) I know the market stinks but these guys are in the sweet spot are they not? Any replies are appreciated.

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They have pipeline infrastructure in place and very little gas to transport throuth it! Somebody please buy them! I'm no expert but I suspect their pipeline infrastructure is way too much for their Cotton Valley assets and way too anemic for the Haynesville potential, which they seem unable to exploit.
They are in the sweet spot.

Their wells are not so good.

I don't think they can hold their leaseholds for long.

The market is not so great right now, it may be hard to close a deal and drill before their wells go dry.

The prognosis is not good.
Not to mention that CHK and HK have been working their leaseholds...
"working their leaseholds" ???????
Some of Cubics leaseholds (leased by tauren, drilled by Fossil) are being topleased by CHK and HK.
Cubic is a working interest in Fossils wells. Tauren is the leasing arm.
How would a toplease be any good on a lease that is past its primary term, but held by production? There is at least one producing Cotton Valley well in each of Cubic's sections. Where they have drilled vertical Haynesvilles, there are two wells in those sections. Some are duel Hoston/Cotton Valley completions. They are all fairly mediocre, but I would think topleasing producing sections would be a very risky business unless you're getting at least 5 year leases. Remember a "commercial" well seems to mean almost anything/or nothing.
They are betting that the wells don't pan out.
Also...most that I have seen are 3years + a 2 year extension.
What do you think Jim?
Would seem impossible to have an effective date other than the date the lease was signed and payment received....in which case it wouldn't be a toplease, but rather just an ordinary lease. I say highly risky business.
This is done quite often, but usually the bulk of the bonus is witheld until the effective date to determine if the lease will be valid.

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