pipeline rates

Chesapeake wants to run a pipeline through our farm in Eastern Ohio.   What price per foot has been offered lately for pipeline right of ways....we assume gas but it could be oil as there is a gas line along the road now.   anyone have any advice?

 

much thanks in advance

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Permalink Reply by Augusta Farmer on March 7, 2012 at 4:20am

UPDATE:

We asked for a revised route to look at so the farm is not cut in half....did not talk $ just wanted to explore a different route and asked for a few other clarifications....the pipeline people were to walk the property today but backed out of the whole deal because the neighbor declined their offer (actually asked for more $) and pipeline walked away saying no deal-we go elsewhere.   They tell me the well next our property will be "shut in" for years until a pipleine route is worked out!!!!   Opinions-are they playing hard ball and threatening to have us pressure neighbor or are ticked because we wanted a different route?   What I don't understand is there is a 8" high pressure gas line along the road between the well pad property and our property that I assume could be tapped for NG....liquids would have to be trucked as they are doing now on another well!    This whole situation seems to stink....what do you think?

Permalink Reply by Stan Smith on March 7, 2012 at 4:43am

They can work other routes... but they will want to capitalize on the investment in the well... couple thousand dollars would not be an issue.  They do have considerations for routing (wetlands, buildings, etc...)   You have no obiligation to convince neighbors for the gas company, but they can't lose if you work the agreements for them.  

You do have to consider that the longer the well is delayed, the longer before you recieve royalty checks.

 

Permalink Reply by Augusta Farmer on March 7, 2012 at 4:54am

My issue is how it has been said....I really don't see a pipeline landman being able to determine if a well is shut in, but who knows what they know.....also, the shut in well has the cababilities to go another route to get product for market.   The proposed pipeline is for connecting an existing/producing well to another that has just started drilling.    We will be pooled in the well that is just starting drilling....so I am not too concerned about delayed royalties from that well just beause the 2 are not connected....but again, I'm not savvy on this.

Permalink Reply by Billy Park Whyde on March 7, 2012 at 5:28am

Look up the lease upon that well and see if there is a shut in clause.

Permalink Reply by Charles Crissman on March 7, 2012 at 5:41am

Myself and  the neighbor behind me total 126 acres turned them down don't fall for the tricks and we were offered 15.00 ft what the timber is valued now and multiple lines they can put in. My lawyer said don't sign this and we didn't.

Lynchburg extention that's what they were calling it. from carroll county to Columbiana wells. 

 

Chesapeake Midstream  said they'll find an alternate route.

Permalink Reply by Stan Smith on March 7, 2012 at 5:47am

Remember the landman is working for the gas company.  He gets paid to get you to sign. 

A pipeline easment is a significant change to the surface of your property and you have the right to set your terms.  That being said...discussion and negotiation rather than fighting will likely get the deal completed.  It would be human nature for the landman to work with the owner resisting the least and at lowest cost.

Permalink Reply by Charles Crissman on March 7, 2012 at 5:49am

We were ready to work with them but THEY SAID BASICALLY TAKE THIS OFFER OR SEE YOU LATER.

Permalink Reply by Stan Smith on March 7, 2012 at 5:51am

bet you they'll be back

Permalink Reply by Charles Crissman on March 7, 2012 at 8:00am

it's been over a month and we heard there talking to others around us .  I hope people don't get taken over this.  The big issue is multiple lines with no compensation for them. people don't sign.

Permalink Reply by Stan Smith on March 7, 2012 at 8:07am

If they do, and you did not... not so bad... at any rate don't turn your cards until it all plays out.  Good luck.

Permalink Reply by James Milleson on March 7, 2012 at 9:05am

organize all connecting landowners, after u do that...how will they go around u....we need to work with our neighbors 1st. Once together, the group can hire a consultant to do the marketing,based on terms that the group works together on and by controlling the acreage you can thus control the talks, set your goals high and be reasonable and prepared to compromise, it has been done the same way in all the plays....some folks are just flat more tolerable and patient....if u need help we r here.  

Permalink Reply by JamesG on March 7, 2012 at 8:38am

I was in a very similar situation where our property would be cut in half and I wanted the pipeline to follow the property boundary.  Ultimately, the pipeline company chose a different route that in my opinion was better for everybody. The compenation for a pipeline is relatively small and can impact the uses of the remaining property greatly.  Landowners need to fully understand the impact of a pipeline on their property and then agree to reasonable compensation.  Remember, if buildings are within the PIR your insurance rates may increase, you get to pay taxes on that portion of the property as long as you own it, the next buyer may not pay market value for a property with a pipeline in the middle of it, and the use of the land above the pipeline needs to be restricted for the safety of the pipeline.  I would not be too upset if a transmission line was not placed in the middle of my property, as long as the pipeline company could come up with a reasonable route.   It is the job of the landmans to find this path of least resistance for routing.  In some instances they may buy property outright.  Good luck

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