"Why Land Groups Fizzle Out"

In the beginning God created a Play, on the first day the oil company adept at leasing swooped in.  On the second day land groups formed and united the earth with great lawyers spearheading the crusade.  Oil companies enticed with hundreds and the thousands, lawyers told the flock this is good, let us rest.  Then the rigs moved in and substantiated the gold and more giants moved in.

 

Alas!  production revealed , bonuses corrected themselves and hundreds of earth owners were left wondering why they took the first offers.  "We were in a landgroup and they told us this is the best we could get." 

 

I have nothing against Landgroups and I have nothing against any property owner who wishes to lease at anytime.  What I do have a problem with is when landowners regret that they prematurely leased.  Well, what do we expect when we were led by non-business people, in fact leaders with no O&G experience at all.  Most landowners have an inate logic of knowing how to deal with their property, I believe it was the dazzle of oil which caused many to not look into themselves on when to lease.  Most property owners know value and know when to sell their corn.  As a business landowner, I have not leased and am watching the nearest wells and production.  It is basically real estate, location, location, location.  I will not regret what I lease for, even it goes up, it is not being greedy that drives me, I just do not want to be had.  The Utica's sweet spot is finite, and they will eventually need everything, I am looking towards a well, production, not swapping paper. 

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Permalink Reply by Mickgyver on October 24, 2011 at 1:35am

Ron , That was an excellent summation and a good idea from the start . 

All of your points are great also since the groups also have allowed many of us to  avoid any intervention from the local landmen or mid lease flippers . Especially since the group motivation creates the power to improve on  the normally one sided leases  which also gives more protection for the properties of all involved .

Most groups have been developed because of some of the business minded people with contacts in the oil and gas business which helps to begin the negotiation process easier and allows them a fairly good outcome for both sides  for the work they are doing 

And the few landowner groups that are being ran by only the people that have formed committee's who will never receive any money whatsoever ,from any of the money that is received by the landowners, are to be praised for caring enough to take on such a workload without extra compensation to help keep all the others informed in all steps off the negotiation process, which will provide the group members as much money as possible when the lease's are finally signed . May God Bless us each with the knowledge to do good with our new found wealth and to wisely plan for the future  which is always uncertain

Permalink Reply by Ron Eiselstein on February 9, 2012 at 8:41am

How is the 80,000 acre land group in Trumbull?  All I hear is next week................

Permalink Reply by Craig Stull on February 9, 2012 at 9:00am

blaaa blaaa blaaaa

Permalink Reply by Adrienne Baker on October 27, 2011 at 4:45pm

I don't think the 750 people in this article think landowner groups fizzle out.

 http://www.vindy.com/news/2011/oct/25/landowners-sign-deal-with-che...

Permalink Reply by Ron Eiselstein on March 17, 2012 at 8:23am

"and it has come to pass?"

Permalink Reply by Olive Sue on March 17, 2012 at 8:47am

Are you saying land owners groups have fizzled?

Permalink Reply by Craig Stull on March 19, 2012 at 3:20am

A few selective Individuals may have something for you next monday.

Permalink Reply by Ron Eiselstein on August 20, 2012 at 11:48pm

Has BP played Trumbulls landgroup for $3900 an acre repeating past landgroups mistakes?

Permalink Reply by Kenny on August 21, 2012 at 10:47pm

the one thing that many landowners don't understand is that many of these landowner groups or "representatives: are doing nothing but costing the landowners money.  I have seen many that are NOT negotiating a better lease than that the oil company is already offering yet charging them a percentage of the bonus payment and/or the royalty payments.  They are getting these landowners the same offer that they they could have gotten directly from the oil company and doing nothing to earn their "commission".  Many of these "leaders" were selling corn on the side of the road a couple of years ago and are merely relying on their name in the area to do nothing but line their pockets with their neighbors bonus money.  Who is the real bad guy....

Permalink Reply by jason smith on August 22, 2012 at 1:21am
The real bad guy is the leader of a landowner group that does not study the history of shale plays, because it can cost landowners millions of dollars.
Permalink Reply by Ron Eiselstein on September 13, 2012 at 11:32pm

Almost a year ago we on GMS brainstormed this issue and yet many have not studied our experiences condemned to repeat the folly.

Permalink Reply by xtreeman on September 14, 2012 at 6:29am

I don't think all landowner groups are the same Ron. Especially ones who are run by lawyers not from the area.

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