My 85 year old mother was visited by a young man requesting an approval to lease her property for &500.00 an acre with a 1/4% royalty for five years. He is with WildHorse Resources d/b/a Antrim Exploraion, llc. We need to know if we should trust these people and sign or should we talk to a lawyer first. Would appreciate any help on this matter.
I doubt you will have to wait long to hear from companies leasing in your area. In 18N-1W, there are a well awaiting completion in Section 14, rigs drilling currently in 18 and 21 and active permits for wells in 13 and 15. No well results made public at this time but a good bit of leasing activity.
Don't get rushed. It is possible that there is competition for leases in your area. Competition is always beneficial for those who can use it to their advantage in negotiations.
Yep, happens all the time.
If the Haynesville Shale is better than the Utica and Marcellus Shales, which it seems to be with the Utica drillers moving back to the Haynesville, why not ask for what we have been getting: $2,500 to $6,000 per acre, with Greene County PA seeing $8,000 an acre due to being in the Rome Trough area.
The March 2011 ALOV Landowners Group, all received $2,500 an acre, followed by the November 2011 ALOV Landowners Group receiving $5,600 an acre.
1/4% Royalty is .0025, how about 1/8th or 12% (0.12) which is the minimum royalty in most states. You didn't mention Gross vs Net.
Again the ALOV Landowners got a 17.5% Gross Royalty in March 2011, with the Nov 2011 ALOV Landowners Group getting 20% Gross Royalty.
Negotiating your own lease with an O&G company is guaranteed to leave you with no landowner protection and a poor lease as far as a bonus and royalty go.
My advice has been NEVER SIGN AN O&G COMPANY LEASE, have a lawyer provide you with a fair lease, then only sign with a drilling company. If you sign a lease with a non-driller, they will sell your lease to the driller and take a percentage of the royalty you could have had and the bonus you should have gotten. Go to alov.us and open up the lease at the bottom of the page titled: SURE Lease March 2012 and you'll see what a good lease looks like. Use it as a starting point with your lawyer. Good Luck.
I don't know of much leasing going on in the Haynesville Shale. Most of it being leased from 2007-2010. A lot of these mineral owners got over $20,000 per acre. Most of these leases in the sweet spots are held by production (HBP). The rigs are drilling alternate wells in HBP units.
TD.P is correct. There is little unleased land prospective for Haynesville Shale. The lands alluded to in this thread are not prospective for Haynesville Shale. The companies active in Lincoln Parish are drilling the Cotton Valley Sand Group. The Haynesville Shale is an unconventional reservoir. The Cotton Valley is a conventional reservoir.
Ron, we regularly encourage GHS members to engage the services of an experienced O&G attorney when considering an offer to lease. Owing to the significant differences in LA mineral law it is not a good idea to use a lease form from another state.
Haynesville Shale is actually way less economic then the Marcellus or Utica. No one is making money at current prices. Also Lincoln County leases are not for Haynesville drilling. Believe it or not there are other ways to drill for O&G than shale wells.
Lincoln Parish most likely Cotton Valley Sand and perhaps Bossier Sand
Chris, the members are aware that the Lincoln Parish development activity is a conventional Cotton Valley combo play. Haynesville Shale needs to be north of $2.50/MMbtu for operators to make a profit. Most would be happy with $3.
Speaking of Utica, I was talking to a group the other day that has a very good (IP 20+ MMCFD) Utica gas well in Ohio with a 80+% NRI lease.
But due to pipeline limitations, they are only netting about $.80 per MCF.
Underscores the issue of take away prices versus "posted prices" for both O&G across various plays. At least the deducts on oil have dropped in many areas (e.g. Permian was over $10 per BO deduct - now less than $5 per BO)