Signing Bonus Union Township

I have 40 acres in Union Township Washington County and been offered 16% and $3,500 per acre by EQT.  Does anyone know what the going rate for a oil & gas lease is in Washington County?

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Permalink Reply by Gas Boy on November 11, 2014 at 1:42pm

For EQT, that is their going rate.  Better take it.

Permalink Reply by Jason on November 11, 2014 at 3:23pm
My brother signed last year with Rice. Rice offered $7,000. Range went to $6000 per acre.
Union twp near Mingo church road.
I think it's 17% gross.
Permalink Reply by Gas Boy on November 12, 2014 at 2:16am

EQT is the only company permitting and drilling wells in that township.  OR, hold out for Rice or Range, and get drilled on by.................

Permalink Reply by Jason on November 12, 2014 at 2:39am
Whatever you decide, make sure the lease is gross and not net. No processing deductions.

Look for a vertical Pough clause. You're in an area that contains upwards of 400 Billion cubic feet of gas in three or four different layers. They can hold all layers by production with just one well into one formation without a vertical Pough clause.

Make sure you understand everything inside that lease before signing. Chances are it will be your only chance to change it. I agree - if EQT is drilling wells then that's a pretty good offer.
But do your homework and be patient. The first offer is never the best.
Good luck!
Permalink Reply by James T Monyak on November 12, 2014 at 3:31am

Great advice.  I didn't think of the different layers as separate O&G leases in the respect to HBP.  Not sure if EQT will see it that way.  Nevertheless, the biggest thing on my list is no deductions and the right to audit.  I have a couple of Marcellus wells already and that is my biggest bone at this point.  I do have a another 12 acre parcel in Finleyville and EQT is offering 4k per acre on that one, but they need that parcel to complete a unit.

Permalink Reply by Adam Martin on November 12, 2014 at 4:58am
EQT definitely knows about the other strata in that area, Burkett, Marcellus and Utica. Are you working directly with EQT or one of their landman company's?
Permalink Reply by James T Monyak on November 12, 2014 at 11:21am

Directly with EQT on both locations.  Has any O&G driller have any success with the Burkett or Utica in Washington County?

Permalink Reply by Jelso on November 13, 2014 at 9:48am

Yep. Both.

Permalink Reply by Adam Martin on November 12, 2014 at 4:57am
Put this in the earlier thread you posted...

What strata does this include, just Marcellus or all including Utica? I would also insist that they remove all production costs or enhancement clauses. The terms that you've mentioned above don't sound too bad but you should be starting at 5k per acre, 18% and no production / enhancement costs. In most cases, production costs will cost you 15 to 20% of your royalty and that doesn't include the nearly 40% that will be sent to the tax man... And always best to have O&G attorney look over the lease before you sign.
Permalink Reply by jason irvine on November 12, 2014 at 12:39pm
I believe 3500 is alittle on the low side. Washington County is in a good area. It has been derisked there for marcellus. U might want to wait and see what the first utica well produces. I think range said December is when they should know. I believe it has a very high pressure so it should do good. Maybe fantastic. Good luck fellow landowner and may all your Wells be gushers
Permalink Reply by Elnathan Cory on November 12, 2014 at 12:47pm
Take it!

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