Replies to This Discussion

Permalink Reply by Jason on August 4, 2014 at 4:21pm

Todd's right. $5,000 at a minimum. Gross royalty.
A depth Pugh Claus, we are a stacked play.

They will walk away the first, second and possibly the third time. But stand firm. It's not that you WON't sign. But on your terms.
Best of luck.
And don't be in a hurry. They told me 5 years ago they were going to drill a well in my area 4 years ago... Still waiting for the experimental well. They'll say anything to get you to sign. The devil is literally in the details.

Permalink Reply by Jason on August 4, 2014 at 4:16pm

Chuck, this is how my lease reads:
Royalty payment clause
Lessee shall pay to lessor free of cost, a royalty equal to 17% of the gross proceeds received by the lessee for the sale of oil, gas or related hydrocarbons produced and sold from the leased premises. It is understood and agreed to the extent lessee sells oil gas or hydrocarbons to an affiliate, the price upon which royalty shall be based shall be based shall be the greater of a) the price paid by the affiliate; or b) the price they would have received from a sale to an unaffiliated third party under a sales agreement for like quantity, quality, term and at the same point of sale as affiliate.
Jason

Permalink Reply by Todd on July 21, 2014 at 6:02am

You're welcome Chuck.
You and your attorney will make the right decision.

Permalink Reply by Charles on August 1, 2014 at 2:27am

All  -   Question   Which is better to get on lease 17% Gross at the well head or 17% Net,  minus production deductions?  I was offered the gross from Range when I told them I did not want to pay for any production costs.  Any help here would be greatly appreciated.

Chuck

Permalink Reply by Dexter Green on August 1, 2014 at 3:30am

No question a gross lease is better.  The cost of enhancement and transportation can easily outstrip the value added by said enhancement.

Permalink Reply by Todd on August 1, 2014 at 4:28am

Chuck,
I would recommend negotiating for 17% gross at the point of sale. In addition, make sure your attorney reviews it and adds specific language prohibiting any deductions of any kind including costs for "post production" and then list them out...

Glad to hear Range is negotiating with you! In addition, I hope your up front bonus is more favorable; but your royalty is far more important.

Permalink Reply by Todd on August 19, 2014 at 2:55pm

Jeffrey Ventura, the President and CEO of Range Resources tells Jim Cramer why his company's portfolio is better than competitors.
http://video.cnbc.com/gallery/?video=3000302956

_______________________________

Permalink Reply by Nancy LeNau on August 19, 2014 at 3:47pm

Nice.... Thank you Todd !

Permalink Reply by Gary on August 27, 2014 at 2:17pm

Does anyone know if Range (or anybody) is leasing in center township, where the cracker is going?

Permalink Reply by Todd on August 27, 2014 at 2:37pm

Gary,

Just checked the BC recorder of deeds records search and Range had 2 new leases in 2014 and about 10 or so leases last year in Center TWP as well as some leases in prior years.

Good question!

Thanks, Todd

Permalink Reply by Brad on August 27, 2014 at 2:47pm

Thought where the cracker plant is going is Potter Twp.But I know center Twp is within a mile.

Permalink Reply by Todd on August 27, 2014 at 2:51pm

Yeah - I think you're right Brad.

Those 2 leases from February and May 2014 to Range had Aliquippa addresses - total leasehold this year of about 50 something acres.

Just checked Potter TWP and there were just a couple tiny parcels (0.5 acre) to Range.

WOW - just checked Hanover TWP and RRC has been feverishly busy leasing up Hanover TWP, BC - 610 leasing documents with SEVERAL from July and August and all of 2014!  I like that being situated unleased 2 miles west of SW Hanover TWP.

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