Some advice needed...

Marcellus Shale Experts,

 

I am looking for some advice on some property that my family has in Butler County. We have 19 acres and we have been contacted by Royal Dutch Shell. We are trying to decide if we want to accept some of the current offers for leasing and royalty rights OR if we should wait a couple years and see if the prices increase. As a family we do not necessarily need the money now and we are interested in seeing how much the prices might increase over the next 5 years, BUT we are concerned about the following and are looking for advice on these particular issues.

 

1. If the neighbors around us lease their rights to Royal Dutch Shell in the near future, does that limit us on competitors? If Royal Dutch Shell starts to put in infrastructure on neighboring properties, will other competitors still solicit us for leasing rights?

 

2. No one in our family is currently living in Pennsylvania, so our "on ground" knowledge is minimal. Is there a leader of a property owner group in Butler Country that we could talk to?

 

Thanks for any help!

 

I've also attached photos of the letters we have received if that helps at all.

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Replies to This Discussion

Permalink Reply by Ponch@Butler on October 31, 2011 at 5:59am
What area of Butler is this property located and what were you offered.
Permalink Reply by Patrick on October 31, 2011 at 12:37pm

Randy,

 

The property is in Northern Butler County, Marion Township. We have not been offered anything yet because we have not replied to the land men yet. We want to hold off and collect as much information as possible before we start negotiating, if we even decide to do that yet. 

Permalink Reply by DKinPA on November 1, 2011 at 11:06am

Patrick,  we have a landowner group which is run by landowners in the Northern Butler County area called Butler County Lanowner Group, BCLG.  In fact our environmental consultant lives in Marion Twp.  We currently have many other landowners in Marion in the group.  We believe that with all of us working together we can reach a fair value lease with strong modifications to the lease along with addendums to protect the landowner.  If you would like more information send an E-mail to BCLG@zoominternet.net 

0jw0dsu4txfuvPermalink Reply by 0jw0dsu4txfuv on October 31, 2011 at 12:52pm

Lease the land. If you hold out theey will go around you. From the fracking process they will get the gas under your land if the go ahead with an exploration program. Sorry basic fact.

Permalink Reply by ShaleAdvice (Steven C. Townsend) on October 31, 2011 at 1:05pm
This is absolutely not true.  The fracking process does not allow for the gas to be sucked out from underneath an adjoining property.  Therefore the law of capture is not an issue.  This sounds like the same scare language many landmen use to convince people to sign bad leases.  Who told that it is a basic fact?
0jw0dsu4txfuvPermalink Reply by 0jw0dsu4txfuv on October 31, 2011 at 1:08pm

So you can absolutely guarantee the expect location of were the frack get it's it gas? The fractures run as does the shale.

Permalink Reply by ShaleAdvice (Steven C. Townsend) on October 31, 2011 at 1:15pm

Homer,

I'm glad you are skeptical...it's a good thing when it comes to these issues.  However, I don't want to use this forum to debate the issue.  I will just say that the scientist and geologist agree with my prior comment.   

0jw0dsu4txfuvPermalink Reply by 0jw0dsu4txfuv on October 31, 2011 at 1:29pm
I have not heard or read a sigle thing anywhere that either proves or states that the exact area of a frack can be predicted. Please tell me how this can be done?
Permalink Reply by Utica Shale on November 3, 2011 at 4:25am

Homer, I have read that they estimate hydraulic fractures can extend up to 1,000' from the production pipe. Then when the pressure is removed they think the proppant keeps only 500' of the fracture open.

 

 There seems to be alot of "thinking" and "estimating" going on!

 I will post a link when I find it.

 

 Do they really know the answers to these questions ...

 

  From how far away can higher pressure gas from the neighboring undrilled land migrate into the lower pressure drilling unit land?

 

 What if there is a very long natural fracture ? Can natural gas migrate down that fracture from adjacent lands that are not receiving any royalties?

 

 We may learn some answers if/when a new horizontal well is drilled along side an existing horizontal well. Will there be any interaction between the two horizontal wells and at what minimum separation?

 

 

 

 

 

 

0jw0dsu4txfuvPermalink Reply by 0jw0dsu4txfuv on November 7, 2011 at 11:51am
Exactly!
Permalink Reply by Patrick on October 31, 2011 at 1:14pm

Shale,

Thank YOU for responding so quickly also. I guess there are a lot of views out there and it's great to have this forum to try and figure it out. 

Permalink Reply by JMS on October 31, 2011 at 3:09pm

Patrick,

Spend a few evenings poking around on this forum, and read as many posts as possible...All of your questions will be answered. 

There are many knowledgeable individuals who will help to guide you, but you have to do alot of reading yourself,so that you can review all the pros and cons.  There have been some fierce battles fought on some of the postings; and generally someone will offer a legitimate sources to get further information. 

Also, there are a few landowner's groups represented as well, and they believe there is strength in numbers, so perhaps checking out a landowner's group in your area would be to your benefit as well.  And don't forget to check out your county postings.

Good Luck...you should be able to get all the info you need here with links to other information sources as well.

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