Replies to This Discussion

Permalink Reply by Two Dogs, Pirate on February 28, 2011 at 15:36

Come on Joe liable and slander? You should have been on here when this site first kicked off.

Permalink Reply by Joe Aldridge on February 28, 2011 at 16:14

I don't appreciate someone making light about something that I have personal knowledge of and was involved in. Secondly, I did not know I needed to be a charter member of this site to post to it.

Permalink Reply by Two Dogs, Pirate on February 28, 2011 at 17:01

Joe, not trying to get on the cross side of you and am not trying to make light of your situation. Just saying that slander and liable are strong words to say about the phrase "Old wives tales". The charter members of this site are not the ones that fuel the site it is the folks like you that are asking the questions. If there were no questions asked, there would be no charter members there to answer.

Permalink Reply by Joe Aldridge on March 1, 2011 at 9:53

Two Dog, I really find it reprehensible that someone would have a problem with what I said and go and publish it to the web and not to me personally. That is just plain childish. More like grade school  than adult behavior. Also, I have no "Dog-in-the-hunt" so to speak other than I like a lot of people on this site have some land that might be in the play and I'm looking for information to help me get a reasonable lease with a company that knows what they are doing. I'm not leasing to some speculator thats going to flip my property.

Permalink Reply by Two Dogs, Pirate on March 1, 2011 at 16:11

Joe, it seems that your beef is with a scientist and his words. Scientists don't go to charm school. I would take a scientists posts with a grain of salt when it comes to social issues.  They look at things as 2+2. I have no dog in this hunt at present but that can change tomorrow. I will try to answer any of your questions but you will need to PM me.

Permalink Reply by The Shadow on March 1, 2011 at 17:30

Joe, with what you know about the Tuscaloosa Marine Shale and the

Austin Chalk as well as other formations (Zones) I would like to get

your opinion.  

Relatives in St. Landry Parish have some land, collectively over 200

acres.  Company wanting to lease for $125.00 per acre, five year lease

and 20% royalty.  High pressure sell to lease.  Want to know what you

think about this and what would you do in this case.  Lease terms

leave a lot to be desired also.  Thanks for any help you can give.

Permalink Reply by Joe Aldridge on March 2, 2011 at 3:41

Good Morning Shadow,

Leasing is usually done in rounds by companies. Round One is get all of the leases that you can as cheaply as you can. Round Two is start picking up leases that were difficult and so forth. This usually takes place over about a year's time period. That's why they want a five year lease. Generally, nothing will happen as far as drilling for the fist couple of years. Its all about land acquisition. Now, You have to understand Leasing is a double edged sword. If you don't lease or if you hold out too long a 200 acre tract (that's almost 1/4 of a 640 acre drilling unit) may slow drilling/development down. On the other hand if you do lease there is no guarantee that they will do any drilling or that any wells that are drilled will be productive. In some areas it may be a case of some speculator leasing up property to put a drilling deal together and flip it or sell it to an operator. So the first question I would ask is what company are you leasing for? I don't mean a leasing company I mean an Operating company. Some companies don't want the public or the industry to know who is interested in an area until they have established a pretty good position in an area. So I assure them that I'll keep any information that they give me confidential if that's what they want. And then live up to that confidential agreement. Don't tell ANYONE who they are or what they are doing. If you do that you will built confidence with them and they'll probably tell you other things down the way that may help you. If you are comfortable with the company then I proceed to lease bonus. If the area is a new play or a step out then I would not have a problem with the $125.00 per acre. But I would want at least a $65.00/ acre rental on a 3 year lease with an option to continue the lease for another 2 years at $500.00 an acre. This puts you in the position to get a good rental if they want to hold it and do nothing or if they don't you can take your lease somewhere else.

On royalty. 20% is good 25% is better. If an area is just opening it may be difficult to get 25% in round one. You may have to wait for Round Two. Make sure it is a NO COST ROYALTY. But try for the 25%. You may want to try to get a 1% unit override if the well is drilled on you property. That will pay you a little extra for the use of your property for the location. 

Lease terms. You definitely want both surface and depth Pugh clauses.  At this point I would go to a good oil and gas attorney to have any additional clauses added to the lease with the stipulation that the company pay my attorney to draw up the final lease.  

These are just ideas that you might consider when you are leasing. Also everybodies position and financial situation is different. So that has to be a consideration. I guess what I'm saying is you just have to do your homework and decide what is important to you and make a decision from there.

I hope this helps.

Permalink Reply by Wheel Man on March 3, 2011 at 14:07

HI

I am a newly leased landowner in East Feliciana Parish, and was told by my landman that the company he represents is within 30 days of permitting two wells not far from my property. Since I am new to this, I am wondering how I can find out when and if these wells are permitted and how to keep up with this activity. I stumbled across this site and it looks like it can be very helpful to new shalers.

Thanks!

Permalink Reply by cocodrie man on March 4, 2011 at 1:53

Joe,

 

How does not leasing slow drilling/development?  For several reasons, I am not of a mind to lease and thought by not doing so I would be force pooled as an Unleased Mineral Owner.  Your insight would be appreciated.  And, thanks for a very informative post.

Permalink Reply by Joe Aldridge on March 4, 2011 at 11:12

Cocodrie Man, 

You are correct if you have a small amount of acreage. If you have a 100 or more then they might wait and see if there is a better block to drill in. The guy that asked me to give my thoughts said his relatives had a couple of hundred acres. That would be a third of a 640 acre unit. I don't think a company would be interested in giving that much production from a unit away. That's just my thoughts.

Wheel Man,

You can go to the State's DNR site. The link is:http//sonris-www.dnr.state.la.us/web_post/lafa_sct.pdf That site will list all activity in South Louisiana by parish from the time of permiting until the well is put in production or P&A. It is updated every Thursday. Where in E. Feliciana are you?

Permalink Reply by Skip Peel - Mineral Consultant on March 31, 2011 at 8:09

2 new L TUSC units by Trek Resources in E. Feliciana and St. Helena parishes

 

http://assets.dnr.la.gov/cons/hearings/2011/05MAY/11-225ap0001.pdf

Permalink Reply by Spring Branch,mineral owner on March 31, 2011 at 13:38

Skip, is the Lower Tusc the same as the Marine Shale?  I thought the Lower Tusc. was below the Marine Shale.

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