Utica / Point Pleasant Royalties Per Month

Hello All, question:  How much money per acre/per month are these folks in Carrolton county getting for their royalties?  I know all wells will be different, some with wet gas, others containing oils.  I'm just looking for a good average.  I'm only 29 years old and sick of working...  trying to determine if I can quit my job now...  Hopefully they don't hit a dry well behind me.  (of course, I'm kidding)

I'm in Southern Mahoning County, but I want info from Carrolton Co.  

Cheers! 

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2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 22, 2012 at 10:40am

"First of all, your alleged Bakken discount (Utica discount) is not going to last long.  Bakken crude oil sells for less than other areas because of transportation issues. Inadequate pipeline to get the oil to refineries increases the cost of moving it, which impacts the price that buyers are willing to pay for it. That differential averaged $17.14 per barrel for the first three months of 2012, according to one report. Others have reported that it has been as high as 25 percent or $25 a barrel.  Some oil producers say they expect to see the differential shrink during the second quarter to about $12.50 to $13.50 per barrel".... your words, not mine.  

The Article above was issued July 10th...The spreads between Bakken and WTI crude oils suggest that it now costs about the same to move crude oil from North Dakota to Cushing as from Cushing to the Gulf Coast. Overall, Bakken now trades at a $25 per barrel discount to Brent.

If there is anyone who has displayed an ability to ignore inconvenient facts (or as you spell it inconvient) ... it is you. 

Permalink Reply by jnm on July 22, 2012 at 1:49pm

There are a lot of numbers here and bickering but back to original question; I've seen actual checks on a Carroll county well and they are between $130 and $150 per acre per month for a 12.5% royalty lease. This is way off all the speculative numbers that we all saw but it can still add up to a nice monthly check!

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 22, 2012 at 2:32pm

JNM,


Actual checks... please don't post anything that SGJ would find contrary to his per acre projections.  He chooses to live in his fantasy world.

Permalink Reply by Jim Litwinowicz on July 22, 2012 at 3:22pm

jnm;  how many acres per pad and how many wells drilled? If its one well and a couple hundred acres or more per pad the numbers will be much higher when all the wells are drilled.

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 22, 2012 at 2:30pm

SGJ,

If I were you, I too would deflect attention away from the fact that none of my stated facts bore any resemblance to reality.  Thankfully, I am not you.  Not sure what it is that you thought "I couldn't resist" but I'm glad it presented you with an opportunity to roll around on the floor laughing (please post picture for our collective amusement).

I could truly care less about what the Bakken to WTI discount is and I only cited it as an example of the fact that location basis is inherently applied to every hydrocarbon product purchase, be it crude oil, natural gas or natural gas liquids.  You are one who chose to dispute what that particular product discount was, I merely replied with factual data as to what that discount has been and what OTHER experts expect going forward.  I made no representations as to what that discount would likely be going forward, nor is it relevant to either the price of tea in China or the lease bonus amounts likely to be offered in Ohio. 

You and your followers can make whatever royalty calculations you choose to make, neither my offerings, nor your formula will make any difference in what oil and gas operators will offer to landowners.  That will be a function of the profitability of the play and what the various competitors choose to do.

I do not "purchase mineral or royalty interests", I have not leased one acre in Ohio, nor do I have any immediate plans to, nor has my company drilled one well in Ohio.  Simply because I took issue with the incorrect factual assumptions that you used for your projection doesn't mean that I have any "agenda"... I don't.  It doesn't matter to me if Ohio lease bonuses and royalty percentages go up or down.  It would be unbelievably egotistically to believe that anything you or I posted on this site would have any impact upon lease bonuses or royalties that end up being offered by the producers operating in Ohio. 

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 22, 2012 at 2:46pm

Shouldn't you be busy working on the next iteration of your royalty calculation fantasy?

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 22, 2012 at 3:26pm

...what offer would that be SGJ?  I have to admit I have considered a career in stand up comedy and your feedback that you have had some laughs is positive reinforcement.  Your fascination with athletic equipment is disturbing... and now I find out you have a horse?  What other surprises are you harboring? 

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 22, 2012 at 3:38pm

As psychologically fascinating as this discussion with you is, I prefer to live in the real world...something with which I suspect you have limited exposure to.  You have hijacked this poor gentleman's discussion topic far longer than need be, and I have unwittingly contributed to that.  

The individual that has actually seen real checks has now provided the information that this poster was seeking (which was how much landowners were currently receiving), versus your delusional projections 20 or 30 years down the road.  Good luck with your future.

Permalink Reply by Butch Ratell on July 26, 2012 at 6:54am

29 AND WANT TO STOP WORKING, THIS IS WHY THE USA IS IN A PROBLEM, THE YOUNG WANT TO SMOKE POT AND DO NOTHING. WELL I HAVE HEARD IF YOU WERE SMART WHEN YOU SIGNED YOUR CONTRACT THAT THE LIQUID THAT COMES OUT OF SOME OF THE WELLS ARE 100.00 A ( GALLON ) AND THEY ESTIMATE 10.000.00 PER MONTH FOR 10 ACRES I THINK ANY ONE COULD LIVE ON THAT. I SURE COULD. I HOPE THEY DRILL AFTER THE FIRST OF THE YEAR. THEY DRILL 8 TO 12 WELLS IN ONE SPOT THAT IS WHY THEY PRODUCE SO MUCH. THE THICKER THE DEPOSIT THE MORE THEY DRILL. BUT IT COULD TAKE 2 YEARS TO GET ON PRODUCTION. 13000 FEET DOWN AND 5000 FEET SIDEWAY X 8 IS A LOT OF DRILLING AND THEY CAN NOT FRACK UNTIL ALL IS DRILLED. IT COST 90,000 A DAY FOR THE DRILL RIG AND THEY DRILL 2 HOLES AT ONE TIME. THIS IS WHAT I HEARD FROM A GOOD SOURCE. SO OHIOANS, A LOT OF PEOPLE WILL BE MILLIONARES IN THE NEXT 15 YRS. WE THE WORLD DOES NOT COLLAPSE.

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 26, 2012 at 7:31am

Actually Butch, meth seems to be the vice of choice among the people in your area, at least that is what the failed drug test results are showing for job applicants.

$100/gallon for liquids, don't those of us in the industry wish that were an accurate statement... It isn't.  Currently NGL's are averaging about $42.50 per barrel... and as you may or may not know, there are 42 gallons in a barrel, so that breaks down to slightly more than $1.00 per gallon, you were only off by two decimal places.  Currently the individual breakdown on liquids components are:

•    Ethane at 31 cents/US gallon is down 61% from last July
•    Propane at 85 cents/US gallon is down 44%
•    Butane at 121 cents/US gallon is down 31%
•    Condensate at 192 cents/US gallon is down 24%

Might be a quite a few "thousandaires" versus millionaires. 

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 26, 2012 at 7:49am

and thankfully, rigs aren't $90,000/d... more like $18,000 to $20,000/d and there isn't a rig made that can drill two holes simultaneously, if that is what you meant by "drilling 2 holes at one time".

2pwt9ru4672sqPermalink Reply by 2pwt9ru4672sq on July 26, 2012 at 10:45am

Well gee willikers Butch... old Tom seems to think that my responses to your posting made you look like a dummy.  You didn't complain that you felt that way, but old Tom sure felt obligated to take up your cause/defense.  I can assure you I had intention of making you out to be a dummy, nor do I believe that I did so, but if you feel slighted by my response then please accept my deepest apology.


Sincerely,


Steve

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