Are many folks seeing operators declining their option period if lease is outside of the "sweet spots" ?
Will be interesting to see what happens. Our lease, with XTO, is up February 2013. We are located in Nac. Co., in Chireno, with one large producing well. However, I just cant see anyone drilling, or leasing for that matter, at $2.00 gas...
Any company with a good cash flow from their oil properties would probably still want to lock up natural gas property while the prices are low - and thus they would have more negotiating power. They are looking at five years (3+2), and who knows where prices will be in five years! Could you have projected two buck gas five years ago?
Of course as in real estate the value depends upon "Location, Location, Location".
realoldguy--if XTO has enough acres and it's laid out in nice unit for H/S laterals I would not be surprise if they drill it before it expires if you have some good offset wells close by. If does not meet this then they will probably let it go.
Very interesting indeed. XTO also has mine and my neighbor's property leased (600+ ac. west Trinity Co.) and our lease also expires in February 2013. XTO has 4 wells permitted within about 3 miles of us but have not started drilling yet. We have heard nothing from them since they exercised their 2 year extension about 1-1/2 years ago.
Vernon and ROG--you could call the landman who worked your lease assuming he is still contracted with XTO and see if he can tell you anything. Also nothing wrong will going to the top by calling XTO office and ask to speak with exploration director for the East Texas area of Nacgodoches County and see if they will share their plans with your minerals. XTO will drill units with good project and proven offset wells in area--- I know from good source they leased last month a 696 acre unit just about mile north of Martinsville. Also you could call their Ft Worth office and ask to speak to their director of leasing and Land management department "Perry" he may tell you wants plans on your lease--- if you get any answer please post to me
Location, location, location is waiting, waiting, waiting on higher nat gas prices. Lease expired in prime area w/ zero interest from O&G's. Good news is 7 billion dollars being invested by petrochemical industry to use NG along Gulf Coast. Bad news is futures market doesn't show substantial upward trend for many years to come. Maybe my grandkids will benefit...
farmbrad, go make yourself feel better about the wait. Look up the production for the two EnCana, BSI Unit A47 wells. They've been on since Jan. and they are the first of the long (7500') lateral wells ECA permitted last year. I promise it will be well worth the wait to get wells like those two. They are right next door to you, too.
#710044 & #715056. You might have to pull up ECA (251691) pending wells to find them, though.