Replies to This Discussion

Permalink Reply by Keith on August 16, 2013 at 6:35

tc, I hate to go political on this site (even though I've spent most of my adult years going political), but this issue is political. What I don't think your looking at is the political pull and possibly the wealth that some of the major land owners have.

Let's say Chesapeake screws with a guy thats like former Governer Mike Foster for instance. The story was that Mike was happy being Mike, until his representative didn't answer his call, so he took his seat in the next election. That's how I remember it at least.

What I'm saying is that the right guy for the times could be out there and know one knows it. I'm libertarian, pro-oilfield, but above all I'm pro-myself and my family, but I'll get behind a small town southern populist democrat if that's what it takes.

As a libertarian I think goverment's main function is protecting my personal liberty and private property rights. When a company does what Chesapeake is doing to people, they are taking your private property.

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Permalink Reply by Skip Peel - Mineral Consultant on August 16, 2013 at 7:10

We don't need to imagine a populist candidate for governor willing to take on the O&G industry.  We had one in Foster Campbell.  It would be a mistake to think that the issue under discussion resonates with enough voters statewide to make such a candidate viable.

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Permalink Reply by Keith on August 16, 2013 at 7:22

No I agree Skip , Foster Cambell was way to liberal and I'm not directly saying it has to be a governor or a democrat. It just someone that understands how to get votes using populism, understands how to shame his fellow politicians into voting with him for this one issue and then using his stance on this issue to make political hay.

Stand up to Chesapeake (for example) and hammer them even while you wink at Chesapeake's competitors who fund your campaign. I'm strictly talking politics. Make a a bad player your strawman especially one that's has actions that can't be defended in public, then run on it to win an election.

Skip it's all how you frame the discussion depending on which crowd your talking to at the time. Bill Clinton was a master at that, he could even bite his lip and cry when needed.

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Permalink Reply by Skip Peel - Mineral Consultant on August 16, 2013 at 7:31

Politically, I think O&G holds the winning hand.  I don't think a pol could separate CHK from the herd.  The rest of the industry would come to their defense because they could be next.  Set a precedent  for punishing CHK and it could be used against the rest of them also.  I'd love to be proven wrong but I've been a lobbyist and seen how state government works up close and in person.  I would suggest that for those who would like to do "something" send an email to their legislators.  And post the responses they receive here.

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Permalink Reply by Keith on August 16, 2013 at 7:42

All I'm saying is that it's all about perception, my Mike Foster example is strictly the perception of being a man of the people that he had in his first election. Many people I knew in South Louisiana had never heard of him, but when he did his first commercial where he was welding, you wouldn't believe how many votes that got him.

Myself I do think Chesapeake can be separated, because in the big picture people don't want to think of themselves as being a bad guy. Hell I work in the Deep Water GOM and don't think every operator even some bad ones didn't separate themselves from BP aftter Macando. There were company officials saying behind closed doors that BP should never get a drilling permit again. I don't think they are a monolithic group.

Permalink Reply by Skip Peel - Mineral Consultant on August 16, 2013 at 7:52

The Foster ad you mention, the one welding, and all the others for that campaign of which I am aware were done by Roy Fletcher.  Mr. Fletcher may be available but his rates have gone up a little since then.  As in A LOT!  Behind every grass roots candidate political success story  there are two elements:  big dollars and talented people like Mr. Fletcher.  And it took all that just to win the governorship of the State of Louisiana.  Taking on the energy industry is a much bigger challenge IMO.  

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Permalink Reply by Keith on August 16, 2013 at 8:09

I don't disagree with your convetional wisdom, but I don't recommend taking on the energy industry, just take on one bad player. My BP example holds true, how many pro oilfield Louisiana republicans ran from BP and attacked them after Macando?

As a politician trying to gain traction you fInd a way to make one of these companies the next BP, then demagogue this issue until you gain traction, you make that company a leper amongst it's peers and you hold your bite like a pit bull. Does any up and coming politician fit this bill?

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Permalink Reply by Hopeful About Natural Gas on August 16, 2013 at 8:10

Out here on the Left Coast people have taken to a new tactic - which I do not like but is effective when the law is not likely to be changed.

It's called Public Shaming. Environmentalists have done it to make mid level management to make both  government and business cower. They call them every name imaginable - like in Gasland. You have to be willing to become a Josh Fox (producer of Gasland) for your side.

You verbally and in print attack the people, not just the law and not just the industry. (in a non-violent, law-abiding way) using social media.

As I said, I don't personally like the tactic but works in a situation where the law is hard to change. Think of what a hundred You Tube videos would do spread out around the Internet on blogs ...

PS: Years ago I was a lobbyist for the ARC, Association for Retarded Citizens and can testify that both Keith and Skip are correct in how hard it is to change practices and what it might take.

Make videos, post them on You Tube and then send those links to blogs and company officials everywhere. Use everyday people telling their stories - not just the horror stories but the stories about how things could simply be done better.

HANG

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Permalink Reply by Keith on August 16, 2013 at 8:50

How about the story of the American Veteran of the Grenada action in the 1980's that lives outside of Bossier city along with his ten children and his soon to be ex-wife. He's crippled with low testosterone and was recieving enough money from his royalties to pay for Cialis and that testosterone cream they advertise on TV, but now his royalty checks are much less because of the way they pay him and now his life has changed. His wife had wanted more children, so she is leaving him because without his treatments and medicine, his crippling ED won't allow him to perform his manly duties.

Is this the way we should treat a war hero? I'm actually crying now!

Roy Fletcher has nothing one me right?

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Permalink Reply by w.r. frank on August 16, 2013 at 8:44

At the moment, there is one main BAD character-Chesapeake. To some degree PXP is also a bad character since PXP purchased 20% of CHK's HA Shale leases. In cases where CHK is the operator, then CHK pays out 100% of the royalty, including PXP's 20%. In cases where other E&P's are the operator CHK pays only its 80% and PXP pays its 20% directly to the royalty owner. So PXP is as guilty as CHK when CHK is the operator in allowing CHK to violate the lease and deduct post-production expenses on leases with "no-cost" clauses.

On units operated by others, PXP is all over the lot. Read the record of Magnolia Point vs. CHK in Judge Hicks Federal court in Shreveport. CHK deducts and PXP doesn't. Read the pleadings in TBE/SFC vs. CHK/PXP in Judge Burgess' District Court in DeSoto Parish. Both CHK and PXP are deducting post-production expenses; however, I know other landowners with an identical "no-cost" clause where CHK deducts and PXP doesn't.

There are numerous cases in Dallas and Fort Worth where CHK is deducting post production expenses in violation of very strong "no-cost" leases. See Ed Bass vs. CHK. See City of Arlington vs. CHK. See settlement of DFW Airport vs. CHK. There is a suit pending in PA accusing CHK of selling NG to itself in order to hide the unlawful deduction of post-production expenses.

All we need is is a law allowing class action lawsuits in Louisiana. Forget the Governorship. I would make every House or Senate candidate from NW LA declare his/her position on an amendment to the LA Mineral Code to allow class action lawsuits and treble damages for underpayment of royalties. There are lots of Parishes in LA with lots of royalty owners. If you honor your lease contract, then you would have no exposure under this law. Evidently, XCO, SWEPI, ECA, BHP and others do not have a problem with lease compliance. Only one-CHK and its 20% partner (PXP)-seem to have a problem.

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Permalink Reply by Keith on August 16, 2013 at 10:56

Skip, I emailed Roy Fletcher today and your memory was correct, he did that commercial with Mike Foster, although it wasn't on his website.

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Permalink Reply by Skip Peel - Mineral Consultant on August 16, 2013 at 11:08

Keith, I've never met Mr. Fletcher but I know a good bit about him and his work through a mutual friend and from my interest in politics.  His media for Mike Foster during that campaign brought him wider recognition and opportunities.  Did he quote you a price?  :-)

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