gregory richardson
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DTE Acquisition of Indigo
4 Replies

Started this discussion. Last reply by JHH Oct 26.

DeSoto: New Production
5 Replies

Started this discussion. Last reply by Les B Aug 31, 2009.

Royalty Questions: DeSoto
2 Replies

Started this discussion. Last reply by gregory richardson Jan 12, 2009.


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JHH replied to gregory richardson's discussion DTE Acquisition of Indigo
"It was Exco... and then Indigo... was once operating in East Texas... and now they're Brookstone.  I didn't know Indigo owned a midstream operation... maybe that's just Louisiana?"
Oct 26
gregory richardson replied to gregory richardson's discussion DTE Acquisition of Indigo
"Thanks ... Indigo has 7 wells on our property. I assume we will still get royalties from them and not DTE."
Oct 25
gregory richardson posted a discussion

DTE Acquisition of Indigo

Just heard about this ... Can someone explain what's going on?DTE Midstream, a non-utility business of DTE Energy (NYSE: DTE), today announced it entered into an agreement to acquire a gathering system and gathering pipeline in the Haynesville shale formation of Louisiana for a purchase price of $2.25 billion in cash, plus a $400 millionmilestone payment upon completion of the gathering pipeline in the second half of 2020. Under the terms of the agreement, DTE will acquire 100 percent of the…See More
Oct 25

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At 6:18am on September 5, 2009, gregory richardson said…
Bonchase ...

If memory serves me you are allowed a 15% annual deduction off of royalties paid - e.g. - if you receive $100k in royalties, you pay taxes on $85k. The deduction goes on forever. As to average price (at least in DeSoto), who knows. It will vary from company to company. We haven't received a check as of yet but I've been told it will be roughly 75% of "market price".

I'll be more than happy to share this number once I know it. It would help if others in DeSoto also shared.

Regards ...

At 7:40pm on September 4, 2009, bonchase said…
I did leave out depletion allowance. How much is that and how long can it be taken?
At what point is that calculated in? Do you have any idea what the average price paid
to producers is for this haynesville shale gas? regards to you too.. bonchase
At 7:13am on September 4, 2009, gregory richardson said…
Martha ... Thanks

My real question was just how a wellhead price is determined. From what I have been able to tell, under Louisiana law, the wellhead price is whatever the o&g company sold the stuff for minus deductibles which would include pipeline charges, Henry Hub charges, compression, cleaning, and the like. The question is "what is the stuff sold for". In some states selling price can be index based (e.g. - local market hub spot price). The national average isn't a good indicator of what we would get in DeSoto. I also understand that the price will vary across o&g companies based upon whatever contracts they have in place.

By the way, you forgot depletion allowance in your calculation.

Regards ... gregory
At 6:36am on September 4, 2009, bonchase said…
Maybe his is how it works, Gregory. Say you own 1/4 the 640 acre unit (160 acres) [160 divided by 640 =.25} . Take that percentage of ownership and multiply it by your royalty amount.. say it is 25% [.25 x .25 =.0625} . Take the production per day x 30 days a month
[6100x30=183,000] times the price of gas (what I found, currently for a national average is $3.45) -631,350 times your .0625 =$39,459 per month. Subtract about 40% for taxes, subtract "at the well head" costs if you have to pay them. Those are costs of getting the gas from the well into the pipeline and can include pressure regulation, drying the gas, separating out water, ect.
I may be way off base, but like you, If I am not going about this estimate right I wuld welcome someone correcting my thinking and will watch for a post to that effect.
Congratulations on your well. I drive by it daily.
At 6:20am on May 4, 2009, gregory richardson said…
Hello! I hope the site is a place for to learn, network and contribute. My name is Keith and I started the site in June of 2008 to open up lines of communication between landowners. We now have over 10,000 members.

Check out current discussions at HERE.

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Have fun SHALING!

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