Replies to This Discussion

Permalink Reply by Philip Brutz on December 3, 2014 at 9:28am

Do you live on the land?  How much is it worth to you to have a big gravel pad on your land for many years?  If you live on the land think about the truck traffic and the noise of the around the clock drilling, flaring etc.  My lease would pay me $25,000 to a have the drilling pad on my property.  If I had the choice I would ask for double or triple that amount.  I have seen plat maps where the pad was not included in the drilling unit.  Make sure that your land is included in the unit or you may get stuck with all of the headaches and no royalties.

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Permalink Reply by Rick S. on December 6, 2014 at 2:46am

We have a lease with Eclipse and in it they state they will need 6 acres for a pad and will pay us $30,000. plus $2000 per acre above 6.

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Permalink Reply by patrick on December 6, 2014 at 6:26am

I was paid 30k for a pad omn my property

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Permalink Reply by Bill Barnaby on December 8, 2014 at 11:23am

The numbers I have heard are 20-30k, not enough.

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Permalink Reply by bo boboski on December 8, 2014 at 12:18pm

They pay what they pay, not any more. You may think it's worth more, and it truly is, but they will pay $25K to $30K and that's it. or they will just set up on your neighbors property, and may even arrange for your property to be excluded from the unit. Sorry, "facts of life" in the O&G biz.

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Permalink Reply by James Foster on December 9, 2014 at 7:24am

$25,000-$30,000 is what I have seen in leases. Also are you in Washington County in Ohio.  Our lease also has in lieu of payments for the free gas you could receive from a traditional type well.  I forget the number of mcf's but in Ohio you can receive up to a certain number of mcf free gas from a traditional well if you are the landowner with the well.  You can not receive gas from a Marcellus or Utica well because it typically needs processed to be safe to use in a home.  So in lieu of free gas you receive payments for the market value of that much gas.

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Permalink Reply by Alan Bowers on December 9, 2014 at 12:55pm

ALOV contract calls for $30,000.00 for each "PAD".  Multiple Wells on the same "PAD" and you only get the one $30,000.00 fee.  If the original PAD acreage is Reclaimed (except for the Christmas Tree) and they come back for another well then you get ANOTHER $30,000.00 fee.

In addition, for EACH post-drilling pit, pond or in-ground containment excavation in which fluids or liquids pertaining to and involved with operations are to be stored you get another $10,000.00 and they need a separate WRITTEN CONSENT.

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Permalink Reply by mlb on December 10, 2014 at 2:05am

25,000 is what I have also heard most often and it is in my lease.  However, I have set backs etc in so there really isn't room for a pad with those in there.  25k is very low to me, I want nothing to do with a pad for only 25k. 

I would certainly try to negotiate for two things.  A higher royalty in your lease and more money for the pad based on acres used not just a flat fee ( if you have set backs and they need you use that ).   Depending on how much land you own ( say 100 acres ), they won't exclude you out of spite, they still want your oil and gas.  Might put pad elsewhere but to me that is okay.  If you have a choice, ask yourself what you could live with, what would make it worth it to you.

People make a lot more off of pipeline ROW going 1000 ft and you never see the thing again.  So prices for well pads needs to go up where possible in my opinion.  You give up 4 to 5 acres, road access for peanuts.  If they want to get rich using your land then they need to pay accordingly in my opinion.

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