Replies to This Discussion

Permalink Reply by Snake Stewart on August 17, 2008 at 14:41

Nice point Mr. E.T. , Sometimes we have to look real hard for that silver lineing , but its usually there somewhere.

• ▶ Reply

Permalink Reply by mike wilson on August 17, 2008 at 14:27

They leased 50% meaning they took the acreage they wanted (*which is in different sections) correct not that they leased 50% across your spread of acreage?

• ▶ Reply

Permalink Reply by Snake Stewart on August 17, 2008 at 14:39

I think they feel a little more light headed myself ! No credibility to lose with me. Sorry about your deal falling through though.

• ▶ Reply

Permalink Reply by Bill G on August 18, 2008 at 4:20

History repeats itself! On the Barnett was the leasing activity consistent throught the intire process? Probably Not! Is there land still being leased? Are those land owners getting more money? I think the answers to these questions are yes. I think that the leasing will run in cycles. These guys will lease then drill, lease then drill, lease then drill. They have multible reasons for running a cycle like this. It keeps the lease bonuses down are atleast consistent with the speculation of "nolonger leasing". It also inables them to secure the leases that they currently have without loosing them or having to pay the extension. It keeps them from flooding the market and lowering the price of the gas. It also gives the company time to stimulate cash flow and show some gains to there stock holders to keep there confidence on board. I think that one needs to just be patient, set a goal on what they want "realistically" and take it when the time comes.

• ▶ Reply

Permalink Reply by griiker on August 18, 2008 at 4:37

I think it is manipulation, Just think practically for a minute. CHK can only drill using 8 rigs (or whatever number they have) and it takes 45 days to drill and complete a well. that means 8 wells this year. 16 next year and 24 the year after that (I am using rough numbers here) that face is, they can't drill the 108 wells over the next 3 years, the usual length for a lease. so they have to slow down the leasing until they get some drilled and in production, or risk wasting money at 10K an acre.

Simply put, even a lion can't bite off more than he can chew.

• ▶ Reply

Permalink Reply by P.G. on August 18, 2008 at 4:53

Yes!
What's that old saying about how to eat an elephant? One bite at a time, right?

• ▶ Reply

Permalink Reply by GetSmart on August 18, 2008 at 4:56

Griiker,
Let's not be short sighted. CHK may be "king" but they're not the only player in town. How many holes can all the numerous other drillers punch???

• ▶ Reply

Permalink Reply by Bill G on August 18, 2008 at 5:35

"Getsmart"...The problem with this is CHK, HK, XTO, Etc. Has priced the small guys out with these huge bonus expectations so without the capitol to invest the so "Kings" are the only ones on the Play in these key areas! So untill they get ready to lease more land you will not be seeing the Small O&G companies coming in and negotiating any leases at this level. Once these large lease amounts were payed out the land owners now expected this amount of money. Why do you think CHK let the mouse out of the bag in the first place. This was to drive the price up on the leases to secure their strong hold in this play and keep the small guys from coming in and leasing out from under them....when they announced this shale many small players were starting to catch on to their mass leasing of land in large areas (Not Pocket gas leasing) and how they were extending their leases outside of there normal field areas (Elm Grove, cotton Valley et)...This resulted in taking the small guys out of the picture, Also there is no quincidence this was done when gas was at record highs. This was to keep the investors confidence high so that they could fund the first round of the (HIGH DOLLAR )leasing and could continue to sale stock and lease land. The lease amounts even at 30K an acre is a very small amount in relation to the amount of profitable gas under this area. You have to remember out of CHK 500,000+ acres of land the average lease is only a little over 5K an acre. Once they got the lease expectations up they backed off and are now developing....DOES THAT MAKE SENCE?

• ▶ Reply

Permalink Reply by P.G. on August 18, 2008 at 6:23

Yep! If you want the little guys out of the poker game, just increase the ante!

• ▶ Reply

Permalink Reply by GetSmart on August 18, 2008 at 7:43

Everyone talks as if CHK is the only O&G in the play. What about HK, XTO, Encana, Shell,etc.?

If the math is correct, (and I don't know) at 108 wells per year it would take CHK over 30 years to drill one well in every section to HBP. I guarantee you that there will be other players!!!

• ▶ Reply

Permalink Reply by po boy on August 18, 2008 at 8:23

Not counting the Dutch, British, canadains, and Chinese there are two pages of "players" in this "sandbox", I am more and more considering leasing with a smaller local company , even if for a lesser amount,just to keep some of the profits "Home",

• ▶ Reply

Permalink Reply by Bill G on August 18, 2008 at 9:01

Po Boy, that would be great if you did that...but i dont see most people taking huge loses in profit just to keep the production money somewhat local. Most people are going to go where the money is no matter who it is with. Alos the other players you metioned may not have the technology needed to extract the gas from this specific play.

• ▶ Reply

• ‹ Previous
• 1
• 2
• 3
• 4
• 5
• Next ›
• Page