According to Marcellus Drilling News, people in Jefferson County, OH are getting offers as high as $6000/acre and 20% for leases with Ascent and Gulfport. These numbers are impressive and reminiscent of offers in the sweet spot during the boom. Hopefully this is a good indicator of what's to come in the near future. Thoughts? Anyone who can confirm these numbers?
No, You are not at all alone in this type of offer. It is not unusual for them to offer low-ball deals - in fact it's very common! Also, they would like to make you doubt the value of what you own. Don't buy it
With us they started with an offer that was utterly ridiculous - in the $200. dollar range and a low royalty % 5 years ago. The terms of the lease were awful, too. This was before people realized what they had here. Fortunately, we told them hit the bricks.
They need to get real and quit wasting your time. These guys hope they can find someone who is unaware of what's going on in area. Good for you for coming on here and getting the information you need to make a good decision. As the other posts show, leases are coming in for 6,000 to 7,000 an acre and 20% gross royalties. What you own is valuable.
By the way, more pipelines are getting the final okay to start shipping natural gas to other regions so the demand is going up
Sometimes, it's hard to believe that this is really happening in our area but it is and hooray for us!
I cant tell you how much I appreciate your help. We are in the dark on this! Think we are also sort of innately trusting. If it weren't for this website, think we would have settled. Funny thing is, if he had offered 4000, we would have taken it. Think the low-balling works against them.
Martin, would you please provide me with the name and number of person offered you 20% gross and 7K acres,
Don't just get hung up with the bonus and royalty amount because you also need a good strong lease to protect you in other ways. You can Google O& G lease and see all of the points that are important to have in your lease. You may not think these points are important to you now because you see dollars and cents but down the road problems can arise and you may find the lease you signed does not protect you. For example if you want to audit the O & G company to be sure they are not cheating you can you? If you find they owe you do they pay an interest penalty? If they drill one well then want to hold off for years without compensating you can they? What if they want to change the Unit size or if they do not drill within 5 years can they extend the lease? Will they pay you the same amount? Did they stick in a " Market Enhancement" clause which is the same thing as allowing them to take ALL the deductions they want? Please see an OIL AND GAS attorney. They also will know what the going price is for your area.
Dott is absolutely right.
The terms of your lease may tie you up literally forever. These corporations/companies have their own oil and gas lawyers draw up extremely lopsided leases so you need your own lawyer in your side of the bargaining.
They will also try to itimidate you with "we'll take it anyway or we'll force-pool you or if you don't sign now it'll be your last chance or anything else they think will work. One is "hey, all your neighbors signed already for less - we're doing you a favor".
It can take time and effort to get a proper lease but you will be glad you did. Continue to educate yourself before taking such a huge step.
Thanks Dott and Jett!
4 more permits issued for Jefferson County last week...that's got to be a good sign..
Darlene, Do you know where in Jefferson the permits were issued ?