Jefferson Co. Land group is with Great Lakes Energy LLC

Has anyone heard of Great lakes Energy LLC ? Not much info online.

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Permalink Reply by CraigL on August 28, 2013 at 1:25pm

If the truth be known Paloma is only looking to flip leases, explain to me how a company who got it's start as a broker in the Barnett Shale working as a broker for CHK, is going to compete with a big player like Great River/AEP. This is not a E&P company, Watch out guys, it looks like Paloma will do what ever they can do to appease the landowner in order to assemble acreage to sell. Why else would they be willing to take a no-surface agreement on a 200 acre property that they have nothing else around to drill the property from. 

Permalink Reply by Terry giuliani on August 28, 2013 at 1:44pm

Craigl,

That was the same way I was thinking. New River guy said the same thing 20min ago. He called Texas and is going to give me a quote tomarrow. Gave me a lot of info in confidence and told me he gets paid if I sign or don't. Said we are sitting on the most valuable mineral rights in the world and do what is right for me. Great River is ready to drill and Jefferson Co. is first, and they are expecting gushers from the tests. Doesn't make it any easier.

Permalink Reply by Patrick Murray on August 28, 2013 at 6:13pm

First off, congrats to anyone that is still negotiating in this area.  This is the kind of position all of us in PA were hoping for, and it's awesome to see it's hitting so close to home. Everyone is going to make some great money from this, and hopefully it will help the community thrive!

The most outstanding thing through this whole process is how willing neighbors are to help other neighbors; the backbone of America.  For the most part, the Oil and Gas companies are doing great; they're making us all a lot of money while giving back to the community. Let's always remember though, there is strength in numbers.  

I believe each landowner wants something similar: the highest bonus payments and royalties from a reputable company that isn't going to endanger their family, pets, livestock, and property.  I believe you guys can easily get $10,000/ acre with 25% royalties, because, there is strength in numbers.  

As a corporation it's their job to "make as much money as possible for the shareholders." As landowners, it's your job to make as much money as possible while protecting our communities.  You can set the standard for a new type of contract: a contract that doesn't have to depend on the EPA or turn into a political debate.  This can hopefully be a guideline for people in tons other counties and states.  Contract is King, and it seems you guys truly have the ability to negotiate with whatever clauses and terms you find fit! 


You are going to set the standards for leases to come, and it's great the community is all working together to make it happen. 

Some responses from the post:

Mike Murphy-- is exactly right: Great Lakes Energy Partners, LLC is Range Resources http://www.post-gazette.com/stories/business/news/ads-say-range-res...

Fang f Fang-- I love everything you are saying on this forum.  I think you just saved a lot of landowners a lot of money!  Kudos to you for that!

 The only thing I have to comment on is I am still very skeptical of Aubrey McClendon.  I love how he brings competition to the market, but I would never sign a lease with him.  So many folks in PA were so ecstatic to get 20% royalties from Chesapeake to find out only a couple of months later, 20% of nothing, is still nothing.  http://uk.reuters.com/article/2013/08/28/chesapeake-marcellus-idUKL... 

I think he knew he wasn't going to pay the full 20% then, and I think he has something up his sleeve now.  

Again though thanks FFF.. you're truly a superhero in this forum!

Permalink Reply by Terry giuliani on August 28, 2013 at 6:17pm
Thanks fang!
I have a feeling it.s not all about the upfront money as much as the quicker chance drilling in this one. New river man here today said it is a true 20% and they're ready to drill Jefferson Co..From their testing they expect great results. Hoping for a long list of royalty checks. He told me I have the richest mineral rights an should demand the best, but this is what the company is willing to pay now and get started. The Paloma lease I would have to wait to be flipped to a drilling co. I'm at the point, let the games begin!
Permalink Reply by Terry giuliani on August 29, 2013 at 7:13am

Just got a call from New River land man, said because I'm in Steubenville Township they can only offer $6200.00&20%. The Paloma Offer is $7000.00 &20%. My question is if the $6200.00 is the better deal because it is with a driller. With Paloma I would get more upfront money but would have to wait to be flipped to a drilling Co..  and traded to be put in a unit. The only other option is to wait and see if somebody else comes along, but my lease with Range expired 2 years ago and this is the only interest since then. Does anybody have any experience with this particular situation? I would have Chk across the street, and new River on both sides, with my 67 acres in the middle .

Permalink Reply by Patrick Murray on August 29, 2013 at 8:08am

Hey Terry,

I've never leased property, but have some thoughts. 

What if you talked to everyone that may be interested.  Aubrey McClendon's company, Rice, CHK, etc.  If you have each one bidding, that is more bargaining power to use for the company that you do choose.  You can even tell them you've been getting a lot of interest from Paloma and New River.

I know it must have been tough to be sitting on this for 2 years, but it seems they obviously want something!  


Contract is still king, and it seems like you have some bargaining power.  Why not try to add a clause to the lease that states "if lessee doesn't drill within (said term's) contract is null and void".  Obviously you'd want to put in one of the newer clauses so they'd actually have to drill deep.  

Also, I'm assuming you've been talking to your neighbor's.  Do any still have land available to help negotiate with you?

Please keep us posted with your findings!

Permalink Reply by Chris on August 29, 2013 at 8:47am

Im interested to see if AEP or Paloma can lease enough ground to have their own drilling units or if they are just going to be participating in CHK units or trade with them.  Most of the big landowners I know leased with CHK 4 years ago.  How much acreage can there be left to lease? Im just curious, my farm is a few miles from the Harrison/Jefferson Border

Permalink Reply by Terry giuliani on August 30, 2013 at 2:11pm

Tonight was sign up night. I had one neighbor call me and say he went to sign up and the lease was for $5,200.00. He question that he thought it had gone to $6,200.00, and they told him not for his area. He asked for a copy of the lease and an attorney told him that was reserved for clients only. Needless to say he left without signing. I saw on news 9 WTOV that the leases ranged from $5,200.00 to $6,850.00 depending on township and number of acres. Still not bad money for small plots. My next door neighbor got $6,800.00 & 20%, I'm going to ride out a little longer see what happens.

Permalink Reply by Patrick Murray on August 30, 2013 at 2:42pm

Thanks for the update Terry. The more I think about it the more it makes sense for the landowner's to create their own group and have a bidding war.  It doesn't make sense for a landowner's "group" to already have the O&G picked out.  I'd love to see you team up with a few neighbors that haven't signed anything and negotiate for a fair market price.  Enjoy your holiday weekend, I'm excited to see what you get offered come Tuesday! 

Permalink Reply by Todd on September 1, 2013 at 6:17pm

Where in Jefferson County and to what formation are they predicting these gushers???

What are the offers in Island Creek and Knox TWP's in Jefferson County?

0i7okn54zwbdoPermalink Reply by 0i7okn54zwbdo on September 1, 2013 at 6:23pm

They're betting on NG prices going much higher, I would assume.

Permalink Reply by Terry giuliani on September 1, 2013 at 6:53pm
Todd,
Cross Creek Township was one of the six townships they approved to get $6,850.00. Steubenville township only offered $6,200.00. Right next door, they must know something .

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