Replies to This Discussion

Permalink Reply by Carol on February 8, 2012 at 10:56am

Michael,

Maybe something I wrote was not clear - for example, last month I received an equivalent of $71 per acre per well.  That's way above the $10 -30 per acre that has been mentioned on this site.  If I was only getting $2 or $3 per acre, I wouldn't even be on this site - I would have no interest in reading about the Marcellus Shale at all.

$71 per acre multiplied by 3 wells multiplied by 23 acres = $4899 (at 2.8 mmcf per day actual average.)

Next five wells have been reported by Rex Energy at 5.5 mmcf per day which should get me to an average at $81 per acre per month per well.  

The first three wells were held back due to pipeline capacity constraints.  I'm not sure what they are producing now. 

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Permalink Reply by mike4t on February 8, 2012 at 11:04am

Carol,

I understand the $71/acre/month...... I thought the reported estimates are $10-$30/acre/well/DAY.... $300-$900/acre /well/month.... so your $2.70/acre/day is well below that estimate

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Permalink Reply by Billy Park Whyde on February 8, 2012 at 11:12am

Carol did you know about this?

 Reply by Billy Park Whyde 34 minutes agoDelete

On a WHOLE DIFFERENT TOPIC HERE BUT I FOUND THIS!

http://thedailyreview.com/news/chesapeake-energy-describes-adjustme... 

Chesapeake Energy describes adjustment in royalty payments 

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Permalink Reply by Carol on February 8, 2012 at 11:31am

Yes, I was aware of that.  Luckily, my lease allows for absolutely NO deductions of any kind.  I have been receiving royalties based on the actual sale price which have been even higher than the rates that are published daily.  Also, I did not sign for 12.5%.  Those with deductions and 12.5% are only receiving about 8% - 9% actual royalties.

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Permalink Reply by Carol on February 8, 2012 at 11:17am

Sorry Michael - I misunderstood your prior post - yes, you are correct, it does equal about $2.70/acre/day/well.  With a 16% royalty, no deductions, and gas prices around $2.60, a well would need to be producing approximately 11.2 mmcf per day to get close to the $10/acre/well/day.  Some wells may be doing that in Washington county and in the NE part of the state, but I don't think anyone is seeing those rates and $ amounts per acre per day in SW PA.  Maybe in Butler county with a Utica well that has oil. 

So, yes, my numbers are true numbers of actual royalties - $2 - $3 per acre per day per well in Westmoreland County.  Those with 12.5% royalty and deductions aren't even seeing that much money.

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Permalink Reply by mike4t on February 8, 2012 at 11:40am

No problem, thanks!

 

It looks like not too many of us are going to be "Shale-ionnaires"

 

Mike

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Permalink Reply by Carol on February 8, 2012 at 12:09pm

Guess it depends on how many acres you own and the number of wells.  If one owns 100 acres or more and is in a unit with multiple wells, they very well may become shale-ionnaires fairly quick.   I have some neighbor shale-ionnaires - and that's just from their bonus money.  Three brothers I know with three separate farms have signed for over $900,000 each in bonus money.  None of them work their day jobs anymore.  In fact, most of the people in my area have quit their day jobs but if you talk to them they say they are not making much money in royalties. 

I'm still expecting well over $100k this year in royalties so I'm not complaining.  And, I don't own anywhere near 100 acres.  In fact, with the expected royalties I'm going to be paying an amount in taxes equal to what I earn at my full time job if I continue working.  I'm not sure it's worth working 40+ hours per week any more. 

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Permalink Reply by Terry W. on February 8, 2012 at 12:42pm

Carol:

Thank your for all the info that you are releasing to us.  It is definitely much

appreciated.

Hope others will do the same.

There are so many variables, but your info gives us a heads up on what

is coming..

Thanks

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Permalink Reply by Carol on February 8, 2012 at 12:53pm

I don't know why everyone is so secretive about their royalties.  Most of the information needed to calculate someone's approximate royalties is available on-line.  Some of the older leases were even recorded in entirety so everyone has access to some royalty percentages. 

I'm looking forward to the DEP production reports to be updated on their website so I know if I start getting paid on 5 more wells this month or next.  I don't know if they went into actual production on December 15th or January 1st. 

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Permalink Reply by gary smith on February 8, 2012 at 5:19pm

heres's some here-say. friend of mine working in warren pa. came across an old guy and his wife from east liverpool. he told my friend he has a hundred acres there. somebody drilled a well and his royalties were 661000 first month. next two months were higher. moved to the big woods. just heresay. good source though.

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Permalink Reply by craig on February 8, 2012 at 5:48pm

That would mean he received $6,100/acre, which is unrealistic.  I would be inclined to say that the well itself had total royalties of that amount. I just looked at a royalty receipt that had total royalties of 482,000+ and 520,000+ for one month on one lateral.

Of course he could also be talking about his signing bonus instead.

Just my thoughts.

Permalink Reply by gary smith on February 8, 2012 at 5:20pm

carol, i'm up for adoption. hahaha

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