"Chesapeake/Total in Da' Hood"

I continue to enjoy observing and predicting the energy companies movements in the Utica play.  In Mahoning county Chesapeake seems to dessiminate info. that they are not interested in urban parcels.  Infact even Hilcorp locally retreated from the rural lands but moved in force into the urban townships.  But alas! last night one of my clients, an inner city church with a Clinton well, rec'd a legal contract directly from Chesapeake requesting that they sign a consent inorder for CHK to assign 25% to TOTAL of France.

 

Observation: all the big boys are working together with CHK and Hicorp here in Mahoning county to complete the leasing of the county, latter to carve off pieces to be sold for production to the oil giants.

 

Prediction: look to see in the near future, Shell, Chevron, Exxon, Hess, CNOOC, etc. in JV or direct purchase of pieces of the wet gas Utica and proceed rapidly into production.

 

This is my real estate opinion. 

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Replies to This Discussion

Permalink Reply by Billy Park Whyde on February 19, 2012 at 11:33am

Idea!!! if a Landowners Group is so Fantastic can anyone provide a copy of the lease for a review by others? Just make a copy, blank out your name and private info. I have seen a lease offered by a attorney led land group and am not happy with it myself. When I hear an attorney trying to tell me what a company will not accept it makes me wonder why he knows, when the land group has not even entered into negotiations. Duh

Permalink Reply by oildude on February 19, 2012 at 1:09pm

Thats the main reason that I wont sign up with a landowners association. They refuse to say who they are talking to or what they are asking for. They say that they cant tell me because I might go around them and talk to the same oil company. I can understand their reasoning but they cant expect people to let them negotiate without any oversight and then present you with a lease contract and say " this is it" take it or leave it. That is an insult to my intelligence. I would never allow that in any other part of my life or finances so why would I allow that in oil negotiations that effect my land? By the way, I was actually thinking along the lines of $7000 an acre and 25%. I guess great minds think alike. 

2s72s0k9mm8gdPermalink Reply by 2s72s0k9mm8gd on February 19, 2012 at 1:49pm

Think maybe the O&G think they are getting a better deal from the groups than they will get from individual holdouts in the end? If true , how ironic for the group members and how lucrative for the group leaders...........? I hope , for the group members' sake , you are wrong. Haven't been hearing much about any upward movement in offers , especially in the oil and wet gas areas lately.......? Perhaps O&G are just taking a break to review and plan their next strategy.

Permalink Reply by Billy Park Whyde on February 19, 2012 at 3:00pm

Glenn when I see lease flipped of like 13,000 acres it takes a while to sort out those leases as not everyone of those leases are the same. When they get them sorted they lay those pieces out onto the land map puzzle and see where the missing pieces are, they will find who owns those missing pieces be it a HBP  or a open land owner.  They will then try to fill the pieces in. As long as they can perpetrate a idea that a landowner can not strike a better deal is bull poop. If they need the landowner they will need to deal with that landowner. No land no drilling. 

Permalink Reply by Billy Park Whyde on February 19, 2012 at 3:12pm

 Ya know Glenn with todays technology it would not surprise me one bit that the O&G have a mapping system that lays out parcels of land with a database that would reference a lease to the plot, the day and hour a lease was to expire, a color fill to identify the holders of lands perhaps even a database on the owners of the leases as well. 

  

2s72s0k9mm8gdPermalink Reply by 2s72s0k9mm8gd on February 19, 2012 at 5:54pm

No doubt they do Billy. We are just pawns in the game being played. All we can do is wait it out and hope we are among the lucky ones that get produced in our lifetime. Like I have said before , they can't produce it all at once. Hell , there isn't enough time or rigs to hold everyone that is leased now anyway. Maybe the best alot of us can hope for is a second round of bonus in 5 years......?

Permalink Reply by Nut leesduh on February 19, 2012 at 3:56pm

After all is said and done, 5yr leases are done and their done cherry picking I'd like to see a map of the leased areas with an overlay of the actual acreage being paid royalties. I think everyone is going to be surprised and disappointed  as to how many people get much of anything. Just a crap shoot like the lottery. But it sure makes everyones life interesting and frustrating for 5 yrs chasing that pot of gold. And any bonus moneys will be long spent.

Permalink Reply by Chartist on February 19, 2012 at 4:06pm

I agree Nutty.....I am on my renewal option with two years to go and not even a seismic test yet....Of course I am in the dry gas region...But, I am in the thickest Utica ....I want to see what that Apache well shows in Argentina....The only cash you can count on is that cash you get up front for signing.

Permalink Reply by Aaron Schwab on February 23, 2012 at 1:00pm

I was signed up for the next group with Buckeye Mineral, and received a call (and letter) that Chesapeake was no longer interested in signing leases in Austintown, Canfield and Poland townships (amount others).

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