Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on November 18, 2008 at 13:01

GoshDarn, There will remain options and strategies that hold the potential for the financial benefit of land/mineral owners. They will just focus less on the bonus element of the equation. The decline in bonus offers should not lead anyone to give up or give in.

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Permalink Reply by Grice on November 18, 2008 at 13:06

Skip, while I respect your position, it does not rule out the possibilities of a new players stepping up to the plate. While there may be an agreement between HK and CHK, it would only pertain to the affairs of those two companies. If a third, less known company, was to move in and begin acquiring land that either HK or CHK (or both) found to be of value, do you think they will continue to work towards lowering the bonus money?

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Permalink Reply by Skip Peel - Mineral Consultant on November 18, 2008 at 13:19

Grice. In my opinion, any new operator entering the play at this time is too late to acquire any substantial contiguous leasehold from land/mineral owners. They would do so from existing leasehold of smaller operators. Such a scenario might create some new, aggressive leasehold acquisition to consolidate acreage required for development but it would be extremely localized. The conditions do not exist for a new operator, even a big oil company with no capex restraints, to pump up bonus offers across the entire extent of the play. The only event that has the potential to change the equation is a significant expansion of the recognized boundaries of the play.

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Permalink Reply by Antsu-in-Japan on November 20, 2008 at 4:49

GREAT points, you conspiracy theorist YOU!! HAhahhaha!! I say we band together and hire a SUPER-DUPER lawyer to see if your thoughts hold merit! (Better yet, I'll run them by my old prof at GWU then I'll contact you by email as to her answer. She still works as a lawyer for some MAJOR clients, so yep... she knows her stuff!!) Shucks, if people keep playing silly games with us, we should get our own little "party" started. I'm sure there's got to be at least ONE major law firm dying to have a go at these major O&G companies!! Those doing nothing wrong have nothing to fear, of course.

Call me on this if you will...but some people seem to keep forgetting that WE LANDOWNERS are the ones owning the gold that makes those rules. It just happens to be BLACK and housed in OUR shale! The O&G companies need to step down a few pegs and remember that THEY are the guests we allow on OUR land!!

And yes...I know! We landowners can "...drill it ourselves..." (as some of you are so quick to point out) if we don't like the climate you big O&G guys bring into our simple lives. Yep, we are all WELL AWARE of that. Best that you don't underestimate the capabilities, knowledge, connections and finances of many of us in here if YOU want to stay in business, that is!! We've already got our day jobs...but you guys need us landowners to keep yours!! Respect us and we will respect you. Be nice to us and we will be nice to you. Work fairly with us...and we will work fairly with you!

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Permalink Reply by Antsu-in-Japan on November 20, 2008 at 5:08

PS - No disrespect meant to you above, Jim Krow.

PSS - Please keep on keeping them straight, KB. Some of us in here really appreciate your efforts and integrity!

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Permalink Reply by The_Baron on November 20, 2008 at 5:11

You do not own the minerals until they are produced. You own the right to explore for minerals.

Section 8 of the mineral code.

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Permalink Reply by The_Baron on November 20, 2008 at 5:28

Your neighbor can "reduce to possesion and ownership allof the minerals occuring naturally in a liquid or gaseous state that can be obtained by operations on or beneath his land even though his operations may cause their migration from beneath the land of another"

Law of Capture. This is why we have conservation units. So every one doesn't feel they need a rig on their land like the old days.

Or as it was said in "There will be Blood",
"I took my straw and drank your milkshake......"

Permalink Reply by Antsu-in-Japan on November 20, 2008 at 6:13

Thanks for pointing that out, Baron. Well, it looks like I at least got the color right!! (No...WAIT!! Gas is colorless, right...or is it!!). It's 2:30am here...can't remember ANYTHING at this hour! HAhahhahaa!

I was focusing on section 4 of the Mineral Code...which, by the way, did not mention production. Then I found what you were saying in section 6 of the code. (Listed below). Thanks for the clarification. I made my correction below...

CORRECTION: Some people seem to keep forgetting that WE LANDOWNERS are the ones owning the land that houses the gold that makes those rules. It just happens to be BLACK and housed in OUR shale! The O&G companies need to step down a few pegs and remember that THEY are the guests we allow on OUR land!!
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CHAPTER 2. THE LANDOWNER'S RIGHTS IN MINERALS

PART 1. OWNERSHIP AS INCLUDING MINERALS OR RIGHTS THERETO

§4. Substances to which Code applicable

The provisions of this Code are applicable to all forms of minerals, including oil and gas. They are also applicable to rights to explore for or mine or remove from land the soil itself, gravel, shells, subterranean water, or other substances occurring naturally in or as a part of the soil or geological formations on or underlying the land.

Acts 1974, No. 50, §1, eff. Jan. 1, 1975.

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RS 31:6 — Right to search for fugitive minerals; elements of ownership of land

Ownership of land does not include ownership of oil, gas, and other minerals occurring naturally in liquid or gaseous form, or of any elements or compounds in solution, emulsion, or association with such minerals. The landowner has the exclusive right to explore and develop his property for the production of such minerals and to reduce them to possession and ownership.

Acts 1974, No. 50, §1, eff. Jan. 1, 1975.

Permalink Reply by The_Baron on November 20, 2008 at 6:20

KB,

They are not producing shale. They are after the gas trapped in it.

Permalink Reply by The_Baron on November 20, 2008 at 6:37

KB, while the gas in the shale is trapped in small pores and will not normally migrate, the shale can be fractured easily to free the gas.

If you neighbor drilled a well, and fraced it, it is posible the fractures could extend under your land, and drain the shale beneath you.

Also, more traditional resevoir, there will be some migration.

Permalink Reply by Grice on November 19, 2008 at 1:23

Skip, again, I respect your position on this issue. However, one does not need to be a operator, to profit from the haynesville Shale. Money is a strong motivator, and the Haynesville Shale offers just such motivation.

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Permalink Reply by Phyllis on November 20, 2008 at 8:31

Skip, Do you think the HS blob will be expanded over the next few years? My land is 10 miles south of Hemphill in Sabine County. At one time I got a couple of phone calls from landmen, but now it appears we are either not over the HS or if we are E&Ps will not come this far south.

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