"Yes it's legal. I know that some companies pay their Lessors the "hedged" price, but most just pay the spot price. The reason being because everyone calls in and complains when the price of gas goes up and they are getting less than…"
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Hedged Gas vs. Spot Gas
2 Replies
Started this discussion. Last reply by Mike Knapp Nov 22, 2010.
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Frank Walker replied to Frank's discussion 'Hedged Gas vs. Spot Gas'"It's important to remember that leases, and I mean every aspect of every lease, are totally 100% negotiable.
Thus, it is erroneous to assert there exists a single basis for payment to Lessors. Lessors are paid individually, based upon the…"
Frank posted a discussionHedged Gas vs. Spot Gas
I understand that gas companies pay out 2 differant types of payments to their investors and Lessors on the production of a well. The investors in the wells get the return on their investment from the "Hedged" gas price, while the Lessors (royalty owners) get paid on "spot" gas. Right now "hedged" gas is over $6/mcf, while "spot" gas is hovering around $4/mcf. Is this legal?
Frank replied to Jim Pollock's discussion 'How to offset some of the federal income taxes associated with lease bonuses'"Send me your bonus money, and for a 20% cut - I'll pay the taxes on it, and I'll send you the rest in three equal installments over the next year. That way, I will pay the taxes, and you will not. :-)"
Frank replied to Two Dogs's discussion 'ONLY LEASE THE MARCELLUS'"Operators are not only interested in the Marcellus Shale, but the Rhinestreet Shale (located above and shallower from the marcellus), and the Utica Shale (about 4000' deeper than the marcellus). Range Resources Utica test well in northeast…"
Frank replied to PI's discussion 'MDS Energy Lease'"Natural gas prices are well below $4/mcf, the economy has flatlined, the housing market just keeps getting worse and worse, citizens are fed up with government - then why is a company throwing out $2000 plus an acre for leases????? Shallow drilling…"
Frank replied to PI's discussion 'MDS Energy Lease'"MDS, Knapp, and Snyders flip leases to Equitable for far more than they offer landowners. :-)"
Frank replied to Shaler's discussion 'Beaver County PA Land Groups'"Frontier is a lease flipper........."
Frank replied to Vic's discussion 'Casing Crew for Drilling Contractors'"Most of the marcellus players are utilizing the drilling contractors located from Indiana, PA to drill tophole and run casing.................Falcon Drilling, U.S. Energy Exploration, Dallas Morris, Whipstock Drilling, Phillips Drilling."
Frank left a comment for Toby Rice"These are 5 year term leases that were taken in Q1/Q2 of 2009 (additional tracts are currently being acquired). Leases are set to expire on 2104. 12.5% royalty payable to the landowner."
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- What is your role in the Marcellus?
- Gas Professional
- Why are you here?
- Networking
- Which state(s) are you following?
- Pennsylvania
Comment Wall (4 comments)
- At 12:06pm on June 15, 2009,
Toby Rice said… - county/twp? assume this is expiring stuff...
- At 12:21pm on June 12, 2009, Toby Rice said…
- 3 year lease as opposed to 5 years...no need paying for timeif we don't need it.
- At 8:58am on June 12, 2009, Toby Rice said…
- sure...would it help you if we could drill in 3?
- At 1:20pm on June 3, 2009,
LandownerKeith Mauck (Site Publisher) said… - great to have you on the site! Hope this is a place for you to learn and contribute!
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