Replies to This Discussion

Permalink Reply by JMS on February 21, 2012 at 5:47pm

Wow!  I am really surprised...I'd hold tight just in case they are not ready to work that area more at this time.

You don't want to accept a substandard lease...this drilling is not going to go away any time soon.

Permalink Reply by Norman J. Wimer on February 21, 2012 at 7:07pm

Tom.... I recently acquired 20 acres with mineral on rt 19  in Muddycreek about 3 miles south of Portersville.  I was immediatly contacted by Saga Land Services just days after the transfer back in November with an offer of $2400/15% surface lease....I retained an attorney, developed some addendums, countered with higher values....and they would'nt budge.  Two weeks ago we agreed on a mere $2500 an acre with  15% royalty....I wanted more but I felt that was the best I was going to get.   Then over the weekend, I hear from the agent that Rex will only allow a signing bonus paid over a 5 year period.   So I am not having much luck.   I understand that my 20 acres is in a drilling poop of 740 acres and I am one of only about 3 holdouts.   Let me know what you think and/or find out.

Permalink Reply by landowner on February 22, 2012 at 12:20am

DO NOT take signing bonus over 5 years, because if/once they drill the signing bonus ends. REX does do a lump sum signing bonus all up front

Permalink Reply by Norman J. Wimer on February 22, 2012 at 2:24am

I am not planning on it, I am just posting what the Land Agent told me yesterday.   That Rex is re-structuring their strategies due to the low cost of gas.   Right now I have nothing on the table other than as described.  

Permalink Reply by DDS on February 22, 2012 at 9:07am

Norman... I work in the environmental field and work closely with some of the big natural gas players, unfortunately I am seeing this trend throughout the industry.  The cost of natural gas is what is driving this trend.  The dry gas that we see in this area isn't as appealing as the wet gas found in Ohio. Utica wells in Ohio could produce 400,000 to 600,000 barrels of oil over the duration of the well (experts estimate).  I have property about 1.5 miles south of your location and will sign with Rex when the opportunity comes. 

Good Luck 

Permalink Reply by Norman J. Wimer on February 22, 2012 at 10:16am

DDS...please stay in touch and I will do the same.  "When the Opportunity Comes" has recently become an unkown.  I just acquired this property 3 months ago...hopefully a fair deal will come back.  Fortunatly I am not driven by money, so if it happens, that is great, if it does'nt, that is fine too.

 

Permalink Reply by Norman J. Wimer on February 21, 2012 at 7:11pm

.....where is the Grubb Farm....north of Portersville, or South??

 

Permalink Reply by landowner on February 22, 2012 at 12:18am

South

Permalink Reply by DDS on March 2, 2012 at 2:12am

The well pad on the Grubb farm is located across Rt 19 from Wagners Foreign Auto Salvage.

Permalink Reply by Norman J. Wimer on March 27, 2012 at 5:13pm

So knowing that I have 20 acres nearly in the center of a nearly fully leased 680 acre pool in Muddycreek Twp, Butler County, why won't Rex Energy lease with me?

Permalink Reply by landowner on March 27, 2012 at 11:44pm

Good question. I hear they will begin drilling that well mid summer.

Permalink Reply by Willi West on March 29, 2012 at 12:45pm

I'd also like to hear answers to this question.

Seems to me, if they have planned and leased this 680 acre pool, then they have also planned where to put the drill pad(s) and where to run the horizontal legs.  If one or more legs is to go under your property, they should be all over you to sign a lease.

But if they don't plan to go under your property, and don't need you for any other purpose, like an pipeline easement or an access road, then why would they want to lease your property?

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