What about people who have current leases (pre-"Shale rush")

My neighbor, unfortunately, signed a lease in 2006.  I haven't seen the lease, but it is with Equity Oil & Gas Funds, Inc., PC Exploration, Inc., and Reserve Energy Exploration Co..  I believe the lease is for 10 years, and they get $5/acre/year (~$700/140+ acres).  There is no well on their property.  Is it possible to "get out" of such a lease?  I feel so bad for them.

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Replies to This Discussion

Permalink Reply by Corvette on September 24, 2011 at 3:27am
Yes, That's what I'm thinking. Don't want to mess-up a second time!
Permalink Reply by Finnbear on September 24, 2011 at 6:22am
How much better than $6k signing bonus do you expect it to get? The lease terms are far more important (and valuable) than the signing bonus. Get a decent signing bonus(and $6k is great) with GOOD lease terms and lock it in.
As Cramer says, Bulls make money, Bears make money, Pigs get slaughtered.
Permalink Reply by time will tell on September 24, 2011 at 6:46am
LOL    Finnbear !
Permalink Reply by SA Frank on September 24, 2011 at 8:15am
who is getting 6k?...never heard that number before.  My point was...don't lock yourself into anything now when the other party can back out on you.  You would never be guarunteed to get the XTO offer as it stands now, if in 6 months the lease prices go down.  They would not pay that. 
Permalink Reply by Corvette on September 24, 2011 at 1:51pm
I agree, I would only sign if they were paying me 10% now and the balance when my original lease expires. I read on the P.a. thread they were paying $6000  and 25% in Wyoming county P.a.
Permalink Reply by Finnbear on September 24, 2011 at 4:57pm

Go back a page on this discussion and Corvette said:

It's $6000 an acre and %25 in Wyoming county P.A.

Permalink Reply by Dan Warfield on October 13, 2011 at 10:33am

Correction...pigs get fed, hogs get slaughtered.

Permalink Reply by time will tell on October 13, 2011 at 10:43am
Thanks for the correction Daniel  . I think we ought to give those poor little o&g companies a break , after all the marcellus was on 4100% under valued . Good work !
Permalink Reply by Dan Warfield on October 13, 2011 at 10:59am
Every person on this site who has a potential to reap a reward from their property for oil and gas leasing should do a bit of google research on the Barnett shale in Texas in the summer of 2008.  The signing bonus payments at that time were beyond compare.  But, in another sense, also look to see what happened to the signing bonus numbers when the economy took a dive.  In comparison, well head gas prices at that time were $10.80/thousand cu.ft.  Today, that same natural gas price is around $3.50.  Yes, its a different time, a different shale play, but, the large company players are still the same.  Do your research.
Permalink Reply by Finnbear on October 13, 2011 at 11:22am
On the farm you are correct but Jim Cramer has always said "Bulls make money, bears make money, and pigs get slaughtered". That is a stock market reference, NOT a farm reference.
Permalink Reply by Dan Warfield on October 13, 2011 at 11:26am

True enough and point taken.

Permalink Reply by time will tell on October 13, 2011 at 12:28pm
LOL Finn

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