how bad do they need it?
i have been approached by an operator in my area, to build a lake on my property. the lake would be about six acres, and would be a water storage facility for their ongoing operations. the operator stated they would be ramping up drilling operations in the upcoming year and had to have a dependable supply of water. i understand all of that and wouldnt mide a small lake on my place. the down side i think would be the nusiance of the truck traffic in and out 24-7 during operations. if i am not mistaken, they plan to buy water from a neighboring lake, store it on my place, and use it when and where they need it.
at this point i am asking myself one thing..... how bad do they need it? water, as we all know is an essential part of drilling and frac operations. they HAVE to have it. i think that will be the key to negioating succesfully. i want to get the most money i can, but i am aware if i shoot too high they may move on down the road. outside of the traffic i cant think of any other real down sides. can any of you? has anyone run across this before? i am clueless as to what type of compensation to ask for. also i dont have any idea of what type of protections to put in place for myself. i have just never had to consider anything like this before.
thanks in advance for all responses.
kj
at this point i am asking myself one thing..... how bad do they need it? water, as we all know is an essential part of drilling and frac operations. they HAVE to have it. i think that will be the key to negioating succesfully. i want to get the most money i can, but i am aware if i shoot too high they may move on down the road. outside of the traffic i cant think of any other real down sides. can any of you? has anyone run across this before? i am clueless as to what type of compensation to ask for. also i dont have any idea of what type of protections to put in place for myself. i have just never had to consider anything like this before.
thanks in advance for all responses.
kj
Views: 107
Replies to This Discussion
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Permalink Reply by Greedy Landowner on
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That was probably a wise move on your part to avoid this deal once they revealed plans for the multiple water wells. Kudos for being a good neighbor to the folks around you.
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Permalink Reply by Randy on -
Someone stated earlier the DNR just frowns upon using well water for fracing operations. For some reason I thought that a new law wouldn't allow that very thing, but maybe I was asleep at the wheel and it didn't pass.
John, If it isn't from you, they'll get those water wells from someone close enough that it will still affect you. Share your concerns with them and ask them to come up with a way to make you feel better about it. Give them your problem, and ask them for a solution, that's what negotiation is about.
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Permalink Reply by king john on
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greedy land owner, i havent voided the deal yet. i am just having major concerns about it. i am trying to think of a way i could rest assured that my water wells would never be utilized as the primary water source. just putting it in the contract is not enough, i would want meters on the wells or something like that so i could moniter the out flow from these water wells. i would also want some agreement i think saying they could not exceed X amount of water per year or month.
randy, i am in texas so the DNR does not apply. thanks for the advice above. that is exactly what i am planning on doing. do you think it is reasonable to request a list of the units within a five mile radius and their acreage so i can have some idea as to how many frac jobs could take place? i have already made it clear, that if we do the deal, the water will be exclusively for their use and there would be no marketing or sharing of the water with other operators in the area.
kj
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Permalink Reply by king john on
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well, they must need it pretty badly. their proposal was very close to the figure i had in mind. i am not willing to say exactly what it was but lets just say randy was waaaaay off in his prediction of what they may be willing to pay. there are a few details to work out but all and all they went for everything i asked for. and yes that included the stocking of the lake and also a recreational pier of some sort. the next step will to be to have an enviromentalist come and do an impact study. assumming all goes well, they intend to get moving very soon on the project. this is great news for shelby county as well as the county line area as this facility would be close enough to transport the water to that location as well as using it on my property .
i believe once the horizontal drilling gets into full swing, water rights will be more valuable than ever. IMHO this is an excellent chance for a surface owner to make some additional monies while gaining an assett.
kj
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