Replies to This Discussion

Permalink Reply by GoshDarn on June 30, 2012 at 10:23

Inquirer:

Is this the  HA RA SUT; COLQUITT RD LND 13 H -- La. State serial #: 242558 -- drilled by HK (Petrohawk) in Caddo Parish?

That would be 13 16N 15W, if it is.

SONRIS shows: 

COMPLETED 9-3-11; GAS; HAYNESVILLE RA; 7267 MCFD; 14/64 CHOKE; 135 BWD; 7307# CP; 2251# CP; PERFS 11,484-15,909'

Note:  You can always check the well by clicking on the link:

http://sonlite.dnr.state.la.us/sundown/cart_prod/cart_con_wellinfo2...

Now, I can only give you my "shade-tree" opinion since I'm not an O&G insider.

This is a decent well (looks to me) -- i.e., with reasonable stats.  In other words, it's not a great well, i.e., it's not a barn-burner (as they say), yet the IP shows it should easily make money (is my best guest, depending on the future price of NG). 

So, congrats.

Bottom line.  HK, CHK, and PXP seem to have a JV agreement on this section (per a very quick read of the info, but I could be wrong).  So, knowing what little I know -- the DO is a request to bring the paperwork up to date.  And that's also a very good sign, in that the associated land dept. seems to think that you're due royalty payments.

Then, more than likely, things will eventually work themselves out.

So, if it was me (and if there are no hidden unknowns here) -- I'd think positive, fill out and mail back the D.O. -- and give it 2 months.

Also, it never hurts to call the 800 number on the D.O. paperwork and ask questions if you feel the need.

Again, congrats on a decent well.

Best of luck with it.

GD

 

 

 

 

 

 

 

 

 

 

 

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Permalink Reply by Inquirer on June 30, 2012 at 10:42

Thanks for the info.  Yes, that is the well.  The involvement of PXP was the confusing part.

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Permalink Reply by GoshDarn on June 30, 2012 at 10:52

Inquirer:

Others might have a different opinion, but my family and I own land under lease in Bossier P. to one very good operator that had a JV with yet another operator.

Anyway, as it turned out, IMHO, it worked to our advantage.  Sorta like one fox watching the other fox in the hen house.

Of course, sometimes when it comes to payouts, certain bad actors start blaming their operating partners.

But I can tell you straight-up from experience on a big HA horiz that I negotiated a lease on for way over 20 big-family heirs -- that the operator we signed with did us darn good and we're thrilled not to have to be in "bed" with the other operator.

Lucky us.

So, if you end up with similar luck, the situation might work to your advantage.

Of course, don't spend it until the check/direct deposit clears the bank.

Take care.

GD

 

 

 

 

 

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Permalink Reply by adubu on June 30, 2012 at 11:03

Inquirer--- all good advise and info from GD-- one added thought I would ask PXP if they are now the operator of the well and if they will be  accountable for all  your royalty payments now in future or they spilt with CHK or HK. Request if that changes you will be notified that operator is changing. Request this to be confirm in writting.  Then before signing DO--- check and make sure the decimal interest is correct per your lease.  Did you signed DO before if so surprised they request another to be sign, but that OK you get chance to check it again. You lease terms should trump the DO.  Happy mail box income and may they one day drill unit to max

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Permalink Reply by Inquirer on June 30, 2012 at 11:50

Thanks GD and adubu! Very helpful info.

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Permalink Reply by Les Bamburg on June 30, 2012 at 18:54

Inquirer, Plains (PXP) acquired 20% interest in all of Chesapeake's acreage in the Haynesville Shale play so would likely owe you royalty along with Chesapeake.  Chesapeake should have sent you an amendment to your lease agreement indicating PXP is a part owner.

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Permalink Reply by Jo Ann Carter on July 1, 2012 at 3:07

Les, I have not comented alot, but I have followed your post. In other words, you do not know me. When did PXP acquire this intrest? I am in section 22-10-14. CHK is the operator. This well is very close to completion, I think, everything is so slow now. I have several friends with wells in this area. No one has said anything about getting a DO from PXP. I just worry about CHK and what I do not know about them. Can you explain a little more? My original lease was with Pennical, they sold to CHK. They did not send us anything telling us they flipped our lease either. It is kind of like sitting here in the dark wondering if anybody remembers you are here.

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Permalink Reply by pal on July 2, 2012 at 3:35

PXP owns 20% of CHK lease. In my case PXP has been great to work with. CHK not so good to work with. PXP pays a month or two faster then CHK on the same well. PXP does not hold deductions per the lease, CHK still holds deductions and pays when they want to. I will never sign a lease with CHK .

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Permalink Reply by GoshDarn on July 2, 2012 at 6:52

Yes, indeed, pal.  Fully agree.

My family is exceptionally lucky to have dodged a humongous bullet by not getting a "fair and reasonable" offer from CHK (a couple of years back); which meant that we couldn't come to terms so we didn't end up signing a lease with the Aubrey McCl. fast-money gang.

Lucky us.  (And oh, per my rather large La. families; the above post about the JV on a Bossier P. section that we did sign a lease with; wasn't a lease with CHK, obviously, since the CHK fight was in yet another parish.  In other words, I manage a rather complex series of leases with a number of operators vis-a-vis bits and pieces of land over a spread-out mineral estate of numerous sections.  It seemed my family like to buy land {way back}.) 

And like you -- I'll fight very, very hard to never ever sign a lease with lying/cheating Chesapeake, nor will my family have anything to do with the Mark O'Neal broker/landmen (who were doing the dirty work for CHK and who had repeatedly lied to us and tried to take advantage of our family's aging senior citizens {living on fixed incomes}).

Can only hope that the lawmen fully prosecute CHK's crimes and send that gang to prison much like happened with Enron.

 

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Permalink Reply by Inquirer on July 2, 2012 at 7:26

The down-side to the leasing process in our neighborhood has been the ill will between neighbors created during the competitive process.  We have learned a lot about greed.

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Permalink Reply by w.r. frank on July 13, 2012 at 6:26

Warning! After 14 months of royalty payments from PXP without deductions (CHK was deducting post-production expenses), PXP abruptly, retroactively and without notice started deduction of post-production expenses. When contacted, PXP representative said PXP had "erroneously failed to deduct the expenses for 14 months." I did not get another royalty payment for three months until PXP recouped the expenses.

I agree with you that PXP is easier to deal with and pays promptly within 45 days. CHK is terrible!!! Would you give me your email address? I have a question to ask. Also I can share some info on my discussions with CHK and PXP. 

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Permalink Reply by Les Bamburg on July 18, 2012 at 3:34

Jo Ann, sorry for the very late response.  Plains acquired the 20% interest effective 6/30/08.  I will correct my earlier statement.  The acquisition covered all Chesapeake acreage in the Haynesville Shale play on that date and Plains had an option to participate (20%) in acreage Chesapeake acquired after that date.  I have attached a copy of the press release.

Attachments:

• 070708CHKPXPFinal.pdf, 54 KB

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