Lease Offers in Harrison County

Updated November 8, 2011

This webpage is a little over a year old. During this time frame oil and gas leasing
offers have increased significantly.

As of November 8, 2011 the signing bonus has increased to $5350-$5800 with the royalty percentage at 20 % gross. Leases are being signed by several companies. The best lease terms are being realized by the landowner groups that offer their acreage through a competitive bidding process. I personally believe the money offers will continue to increase with time. The highest offers occur when landowners pool their land into contiguous units.

Presumably, all are aware that Chesapeake recently leveraged 25% of their leaseholds in

Eastern Ohio for $15,000 per acre by forming a JV with an undisclosed oil major.

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Replies to This Discussion

Permalink Reply by Al Cramblett on July 31, 2011 at 4:46am

Frank, first, I would not fret over the situation you described. Nate has already provided a response, but I'll add my two cents worth. I personally would be praying that the leases expire so one could release. However I would not be setting on my duff doing nothing. I would be talking to my neighboring landowners, sharing the knowledge that you're gaining on this website, and try to build a contiguous landmass should you all be able to release. Finally, I would suggest that you go to the Talisman Energy thread and read Al Wood's comment which was posted earlier today. Good luck.

Permalink Reply by Frank Moll on July 31, 2011 at 10:23am
Thanks, I have 150 acre and my immediate neighbor has 400 in the same situation. Most the other land around me is consolidated coal. have you heard if they ever signed their land? They own quite a bit it the county
Permalink Reply by Al Cramblett on August 1, 2011 at 4:06am
Frank, it appears as though you're doing your homework -- I'm proud of you! Continue to stay in contact with your 400 acred neighbor. A 550 acre contiguous parcel creates a strong negotiating position. I have heard some rumors regarding the coal companies mineral holdings, but I consider the comments to be rumors. I prefer to deal in facts.
Permalink Reply by earl miller on July 31, 2011 at 7:54am

who is the 3500 to 3700 lease with in harrison  and number call thanks

Permalink Reply by Al Cramblett on August 1, 2011 at 4:17am

Earl, welcome to the neighborhood! It is exceedingly hard to get folks to talk about money. I spend a lot of time on the phone trying to get information to share with those who visit this website. Out of courtesy, I never ask for names and telephone numbers of contacts at the oil and gas companies. Consequently, I really don't have the information that you're asking of me. I'd recommend that you go back to the beginning of this thread and read all the posts. I don't know how many acres you own but would recommend you talk to your neighbors and try to put together a large contiguous acreagerage before you start negotiations. Good luck to you.

Permalink Reply by psychosid on August 10, 2011 at 3:59pm

That deal was through Piergallini Law and Marquette.  Signing was on 8-8-11.  Piergallini negotiated 42 paragraph addendum to Marquette's standard lease.  It ended up $3700/acre + 17.5% royalties gross.  Only took acreage in Harrison and Jefferson.

Permalink Reply by porkchop on August 1, 2011 at 10:30am

Al - We own approx 250 acres of mineral rights in Harrison Co.  However there are 8 surface owners involved.  If CHK want to drill what rights do the surface owners have vs mineral rights owners.  Also is it safe to assume that if we are part of a 640 acre plot would we get approx 40% on royalties?

Thanks for keeping us newbies so well informed.

Permalink Reply by FXEF on August 1, 2011 at 12:23pm
Surface owners that do not have mineral rights will only be compensated for ROW and/or roads and well pad sites and any damages to the surface. Surface owners can not lease the minerals unless they own them. Mineral owners will lease and will receive their proportional share of all royalties paid. It is possible that the surface owners could own part of the minerals, therefore in that case they could lease and be paid their share of royalty.
Permalink Reply by scott jackovitch on August 1, 2011 at 12:39pm
What is going to take place after all of the land is leased up ? I assume that there will be property owners leased with one company and their neighbors leased with others . I know of some areas where several companies have land tied up in your average neighborhood. What did the companies do in the Marcellus land rush of PA ? Do they get together after it is all said and done and trade their land around like we did with our baseball cards when we were kids ?
Permalink Reply by FXEF on August 1, 2011 at 12:56pm

Scott,

 

That's where pooling rules of the drilling unit would come into play. Each state has their own set of pooling and drilling unit rules.

Permalink Reply by scott jackovitch on August 1, 2011 at 2:39pm
I know about the pooling i guess my question is do the oil companies swap or sell leases betwwen themselves ?  For example one company has 100 acres and they are looking for 100 more to make a drilling unit but all the adjoining land is held by a different oil company. would they trade or sell between themselves to aquire the land to form the unit ?
Permalink Reply by FXEF on August 1, 2011 at 3:28pm

scott,

 O&G companies do swap and sell leases, however that is not to say that will happen in all cases. There are a lot of variables that come into play with this type of transaction.

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