Replies to This Discussion

Permalink Reply by Buckeye Fan on June 22, 2011 at 2:42pm

Gary,

What is MCWD? We are close to signing with CHK but I am still waiting for ALL of my addendums to be approved.

Permalink Reply by Dan on June 22, 2011 at 3:44pm

Scott,

It's actually MWCD and it stands for Muskingum Watershed Conservancy District.  They manage thousands of acres of land around the larger lakes in our county and in several other counties too.  They directly own about 15000 acres in Harrison County alone.  It is surmised that whoever makes a drilling deal with them will gain priveliged rights for water usage, which is a prize in itself for this kind of drilling.  However, if Gulfport has made a deal with MWCD for some of it's acreage, then that does not necessarily mean that adjacent landowners should join in with them automatically.  They should still make sure that the lease document is favorable to the landowner and that the compensation is good.  Better yet, pool with a landowner group to really increase your negotiating leverage.

 

As far as waiting for Chesapeake, I have seen pretty much all the addendums Chesepeake will offer, and even with them all, it still is not a very landowner-friendly agreement compared to the better documents that are out there.  The document you will sign is very important! Read this document <here> and compare it to what Chesapeake is planning to give you.  You will see a vast difference. This was is a lease that Chesapeake has actually signed, but only through a landowner group with its negotiating advantage.

Permalink Reply by Josh on June 22, 2011 at 3:53pm

Dan,

You  beat me to the punch,  I appreciate all the info you .are passing along

Permalink Reply by Josh on June 22, 2011 at 3:50pm

Muskingum Watershed Conservation District which I believe encompasses all of the land in and around Leesville,Atwood,Tappan,Piedmont, and Clendenning.  That is good chunk of land, I am glad we are starting to see more competition.  As far as the Buell well is concerned I was told they dont have to release any production numbers until Jan 2012??  I have heard so many different rumors about when CHK is going to relase them though. 

Permalink Reply by Dan on June 22, 2011 at 4:11pm

Josh, I was confused about production number reporting dates myself, but when I asked for clarification at the Mineral Division, I was told that actual production numbers won't be released until Jan 2012, which makes sense, in that by then there will actually be some kind of production history to report.  However, the initial production numbers of oil, gas, and brine is supposed to be reported 60 days after completion of the well.  Admitedly, initial production numbers will be high and not indicative of the actual production over the first several months or year, but since they can be used as a comparative guage to predict how good the well is going to be, they are still very important numbers to know.  And those numbers should be coming out in the next couple of weeks. ODNR is pressing them to release them as soon as possible, even before the 60 days, but CHK is likely to wait until the last possible day.  Even that date is not known for sure because there is some ambiguity about what constitutes the "completion" of the well, and of course CHK interprets it to be the latest possible date.  Even with that ambiguity, the numbers should be showing up pretty soon, hopefully.

Permalink Reply by Mark Allen on June 23, 2011 at 2:26am

it is amazing how little most of you know about Harrison county, yet this is the Harrison County site.

 

Josh-Paul-Dan are you landowners in Harrison?  

 

This is a liguids rich play,just  ask Aubrey.   The CHK wells will get drilled and ONCE THE PROOF IS PROVEN then the real deals are started,then CHK will flip that proven acreage in about 14months of it being proven to large investors or other TRUE -LIQUIDS proven companies.  CHK,has 1.3million acres do you honestly believe they can develope them all?     The joint ventures have been going on for 2 years or better, check your own properties,and assignments who knows maybe EXXON-SHELL-BP-CHEVRON will buy out chesepeake,as you can read through out the shale play-Aubrey is a risk taker ,he has a reputation of being unpredictable-the hype on all these wells maybe coming from within the industry creating the marketplace for a huge sale off.

 

OIL,WET GAS OR GAS, where is the money today?

Who is building the infrastructure?

We do have a huge deposit and it will get developed, but be open minded here-the names change daily and the players do as well.

 

Harrison Countians need to protect their own.

 

ASK AL........

 

  

Permalink Reply by Shower Bath on June 23, 2011 at 4:24am

Here is a good site for shalers to use for info, such as the value of wet gas vs

dry gas, leasing, etc.

 

www.gohaynesvilleshale.com/

.

 

Randy

 

Permalink Reply by Josh on June 23, 2011 at 10:37am

Mark,

 

I am a Harrison County landowner, why do you ask?

Permalink Reply by Paul Martinelli on June 23, 2011 at 3:22am

I have heard that MWCD  was in talks with Gulfport....for the ~30,000 unleased acres they have...that is a big deal!

 

 

Dan, Bonus money will probably only amount to ~1 years royalties....

Permalink Reply by Dan on June 23, 2011 at 5:05am

Paul, for that to be true you would have to have very good production and high prices at the time of that production and sale, which would be great, but we are just not sure of that at this point.  Also, your statement still ignores the time value of money.  Getting $2k/acre today is worth more than getting that same amount a couple years from now.  I do agree that royalty is more important than signing bonus, I just don't think it should be called "nothing" compared to royalty.  They both work together. As leases become more valuable to the gas companies, they both should go up.

Permalink Reply by Paul Martinelli on June 23, 2011 at 6:31am

I agree with what you are saying...the bonus money isn't nothing...but compared to royalty on a "good oil " prodcing well....which is what I belive we all will see in this area (BTW, I an in Tusc., have relatives in Harrison), it pales in comparison.  But in many cases...the bonus money may all you see for some time to come.

 

I'd be willing to take 50% less bonus money in exchange for a guarantee of a well being completed within 9 months.  Not saying that is a good deal for all....but it meets my needs quite nicely.

 

Al has some good points.....this is going to explode here in the near future...patience will be rewarded.

Permalink Reply by Al Cramblett on June 23, 2011 at 5:09am

Thanks to all who are posting on this site! However, I caution those who view this site to conduct their own due diligence to determine what the real story is in Harrison County. That includes the two cents worth that follows.

 

It has been known for over 100 years that hydrocarbons are lying beneath the surface in Harrison County. It is estimated that only 15 percent of those liquids were removed during the oil boom days of the late 1800s. What has changed and is the impetus for the current activity in Harrison County is the advent of horizontal drilling. With the current, depressed prices for natural gas, the oil and gas companies are after liquids at this point in time.

 

Be patient; it is the most important virtue at this point. I spoke to a neighboring landowner last week. He is a very reliable source and indicated he just signed a lease for $3500 per acre at a 20% gross royalty. New companies are entering our County rather quickly now. In terms of the value of our minerals, I am personally, decidedly convinced that the royalty amount is paramount due to its long-term payment. This country is going to experience horrendous inflation in the near term. Energy prices will increase if this happens, and the royalty owner will be protected.

 

I'm not going to name names but all oil and gas companies are not created equal. One of the companies operating in Ohio is currently out on the street trying to sell 4.8 million shares. That company's ability to pay these large signing bonuses will depend upon their ability to sell the aforementioned shares to investors. Unfortunately, I also agree that many of the current lease holders will sell their lease to major firms as recently happened in Arkansas.

 

As a mineral rights owner, I challenge all to educate yourself, help protect the environment, and do all you can to ensure a legacy for family members.

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