You will find that PVA (Penn Virginia) is not currenlty leasing, and hasn't been for a while. I was workign in that area, specifically Hebron for a while and there was a small company a few years ago and PGE. PGE has since sold to Exxon, and the other company seems to have teamed up with someone else as well. PVA won a bid on the state game lands, leased around it for a bit and then teamed up with the other company, not PGE, to drill a well in Hebron area.
They are drilling, not leasing. If you did not get a lease by now, based on the drilling units I have seen, not sure what leasing will be available at this time, or for some time to come.
I own land and mineral rights all over the country, have seen it develop many times - especially in areas like Potter county and McKean county. They have lots of old production, its hard to get a leasehold, and people hold out hoping something better will come. If you hold out too long, drilling comes in the area, lease, set-up dilling units, and if there are multiple operators can set them up in such a way that you fall in between two and with horizontal drillign techniques, you are caught out in the cold. Be careful, hold out for what you can get, but not too long. There are groups in the Potter and McKean area that have been formed for 3 to 4 years now and had no takers. That can be dangerous. If they own their mineral rights, and they fall between two drillign units, they can be locked out, just because drilling units cannot over run each other, and if you are the one in between, then it can be tough to get alease later. I am not trying to scare you, just let you know what I have seen firsthand.
This is fantastic info and great advise. What would you suggest doing if you were in this spot given the most current trends? KAnderson - is your land in both Potter and McKean? We own a good chunk of all OGM rights in both Counties and are trying to decide the best way to take our land to market.
Depending on the location of the OGM's - the thought changes. Where you are right now is in a spot where companies have tested the area. Some have found that it will work for their desires, others have determined that they are not going to explore further. They have holdings in other areas and are going to focus upon those.
That, then, leaves you out a little bit. When I was working over there, the company I was working for was paying more than anyone had ever paid in the area, but not the thousands that people started hearing about, so owners started holding out. A lot of the people that leased early on got wells - these people get a royalty check whether the company makes money or not.
My suggestion is to lease, lease as early as you feel comfortable with and protect yourself from being held too easily.
Many of the people on this site will disagree with me - let them. PA is different than many places, and the people up here seem to broad stroke everything - if it worked in one place, it will work in another the same way. WRONG.
In the eastern part of PA, and the SW part, there was little drilling and large open areas for leasing. This type of situation works well for landowner groups, but, only if there is interest and proven ground.
Potter and McKean are not like this at all - the majority of the two counties are HBP, the majority of the surface owners do not own the OGM's and if they do, they tend to be surrounded by stuff that is owned by someone else.
In fact, Janice Lanphere's family owns severed minerals in NW Potter and NE McKean. If you check the land records and truly search them out, you find that a lot of her property that they own OGM's on, is almost an island unto itself - surrounded by owned OGM's (owned by EOG) or HBP areas that are under contract to others and being produced. Then, if you search further, you find that several attorneys in the area bought large chunks of OGM's at tax auctions and they have been leasing these out for years, and now much of it is under lease to Great Lakes/Range, and then GL assigned it to PGE, which makes it Exxon. So, when others come in and try to lease, or form groups, the tracts are scattered, or very small groups of tracts of land. This is not conducive to bringing big dollars.
The situation in Potter and McKean is odd right now - so, if you can give me a general location fo your OGM's - township? - I might be able to give you a better idea as to what I would do in your position. My answer would be different for different areas, and there are some areas of the county that I do not have a good handle on, but know some fo the geology.
The 4 County group has been around since late 2007, early 2008. They have not gotten a lease. Now, several companies have tried the area, and found it wanting. PGE is still up there working. PVA has some holdings in the area, but I just talked to a frined in the area that was in talks with them,a nd they do not want his OGM's now - and they were the ones paying big dollars in the area for a short time. PVA drilled some wells to test the area, and pulled out of North, NW Potter - they wee not even in McKean in the northern part - which is what I was trying to rell people for years - that area is not the best opportunity and it is going to take a special group/company to lease and then drill, people still held out and now companies are pulling back and found other areas - like Eagle Ford in Texas for EOG - to focus on, and they have no need to come back to the area for a while to pay big bucks in an area that is not fiscally promising.
The southern portions of both counties is better - better opportunity for good payback to the companies, therefore better opportunity for good front end monies to OGM owners, but, there is a ton of production down there also, and this means if someone knocks on your dooor for taking a lease, and they have production in the area, and have a plan - get some protections for HBP - and lease. Get in on the front end, get a well, and move on. Yes, in most cases the wells don't get drilled, but you can protect yourself on thatv end also - remember, it takes about 3 years now to get a development plan done and permits given, so give the company some tiime to get the production underway, and if they don't, mitigate your risk with drilling commitments.
PM me, and I can give you more information, or advise, but the naysayers on this site are unreal - financial planners, promoters, and the like that are late to the table and don't know all sides of the business.
I have worked on rigs - as a pumper, roustabout, and driller - I have worked on the production side well-tending, I have worked as a financial planner raising monies to go into well-drilling programs, I have worked in the back office support side doing revenue runs for the producers, I have worked as a landman and abstractor, I have worked as an advocate for property owners in several states where companies have not held up their portion of the contracts and we have had to gather informaation and evidence for hearings to break leases, or enforce old ones to the landowners benefit. I own land and lease it out to drilling companies - I work with friends, family, churchmembers all over the country to assist them with leases and negotiate with the companies with them to get reasonable terms, but get the thing off high-center and move it forward.
I do this, not as a promoter charging for my services, but as a servant to better the opportunity for those that are truly looking to move their opportunity along.
I charge oil and gas companies for my services if they ask for them - I gotta make a living on a daily basis, but I also work at many other things and travel all over the US. I have been in 29 different states in the last 11 years.
If I "hit a good lick" at what I am doing, then I try to advance my opportunities in the area by buying interest in properties, typically with people I have met in the area and they have found good opportunities, so I end up owning pieces and parts all over. And no, not as a deal flipper - I take contract jobs after disasters and work for the feds and others to determine costs for rebuilding infrastructure, so the naysayers can stop getting giddy about what I might do for a living.
hi Craig. i just sent you an invitation. I am interested in our discussion and would like to continue this.
Really appreciate your insight.
In my opinion your assessement of the 4 County Group/Co-X is accurate! They have had ample time to market the acreage with no success and they are now attempting to find acreage in areas that are geologically better in order to mix the "good acreage" with the "not so good acreage". I still think the 4 County Acreage has a buyer out their somewhere but I also think their $$$ expectations are way high. I'm guessing in the $700 - $1,000 per acre range they may get some interested parties.
actually lots of people in tioga only got 12.5 % and 1500 per acre but the average is 15% and 2000 per acre its not the money per acre that is important its your percentage and your lease.I would make dam sure that you have an attorney that knows what there doing not a local yocal fyi! There is alot of land and alot of gas the leaseing has slowed down big time these companies are focused on infrustructure and selling some gas not the leaseing so much anymore you might try to sqeeze 18% but thats pushing it the key is to get leased and have a good lease with a nice percentage!!! I hope that helps, and i would go on the tioga site and ask questions as I am on both and have property in both counties.