Marcellus in Ohio

I am new to this forum and I have 10 acres in Columbiana County, Ohio. I have had an offer of 250.00 per acre to lease my land for drilling into the marcellus. I am not about to sign that but I am just wondering what a fair price would be in columbiana county? I have a sister-in-law that works at the courthouse and she says that they are swamped with landmen trying to find out who owns leases or whos land has not yet been leased. As I understand it, the marcellus is not that thick in Ohio so why are they so interested in it?

 

 

My land is surrounded by other land that was leased about 20 years ago and there are many wells around that were drilled at that time. My land was supposed to be part of a 40 plot but that well was never drilled and my lease expired years ago. Some of the land around me is still leased because there are producing wells on that land. Would it be possible for my neighbors to get a new lease to drill into the marcellus. I know that they are receiving offers for leasing but they think that they cannot get a new lease because of the old wells.

 

Someone told me that the old leases were only to lease the shallower formations in the ground and they do not include the marcellus so it is fairgame. Is this true?

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Permalink Reply by Nate on September 19, 2010 at 2:24pm
Jim typically if one is leased and they are receiving royalties on a well they can not be leased because there is a well producing in "paying quantities" that their lease is a part of. As for your offer I would hold out longer what these companies are looking for more than the Marcellus is what is known as the Utica shale. It is a much thicker shale that is below the Clinton/Medina and has similar depths and organic content to the Marcellus in PA.

Best of luck,

Nate
Permalink Reply by Jim Pollock on September 19, 2010 at 3:10pm
Nate,

Thank you very much for the reply. I talked to the landman that offered me the 250.00 and he said that they are trying to buy up the old well leases. I am just wondering why they would want these old leases. Can they still drill even though there is about 1 well for every 40 acres already? My mom gets a very small percentage of the royalties off of the well closest to me and her last check was only $ .45 Would it be possible that they are going to buy up these old leases and then go into the old wells and change them into a horizontal well?


There is only 2- 40 acre plots close to me that don't already have a producing well and they would need my land for the 1 -40 acre plot. In Ohio, how many acres do they need for a horizontal well? The landman said that they are trying to get 640 acre plots together.

I also talked to a neighbor that is a couple miles away and this same landman offered him 1500.00 an acre and 15% so the price seems to be coming up fast.
Permalink Reply by Nate on September 20, 2010 at 6:58am
These leases are held by the production of whoever owns the well. So the landman or company that he works for is going to have to get ahold of the owner of the wells so they can farmout their deep acreage, because the horizon that this new company wants to drill to is deeper than the existing wells. 640 acres would be ideal for the company that is wanting to drill horizontal because they would like to go a mile horizontal and 640 acres would be a square mile.

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