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Permalink Reply by BirdDog on March 17, 2013 at 12:52pm

Cunningham was just trying to flip the leases. They did not come through with the upfront money.  It seems like interest is picking up, but still no "real" activity yet. It will be interesting to see what happens in our area.

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Permalink Reply by Deer Hunter Bob on March 18, 2013 at 3:34am

Cunningham never did a thing.  They promised everyone $2500/acre and never paid in 90 business days. Then they asked for a 60 day extension; never paid on that.  Then they asked for everyone to sign a new lease that was for $5200/acre over 11 years with only $100/acre gauranteed; and they never paid that.  They went from heroes in the county to being run out of the county.  Wishgard signed a few leases and those were not paid. Seems like the new data isn't making companies run to Athens to start leasing.  Everything i've read says that 1 new data point in the entire county won't change the minds of major companies when it comes to leasing and apparently that new data just showed it had some liquid, not that it was going to be worth drilling.  Rumors in town are that the hayes well showed the utica/ptpleasant is very thin.  We'll see what happens.

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Permalink Reply by Deer Hunter Bob on March 18, 2013 at 8:29am

A quick look at the report (and i didn't read it all) shows the utica started at 5830' deep and stopped at 5990'.  That would be a thickness of 160 feet.  They also have on there the pt. pleasant was about 20 feet thick. 

 

I'm not disputing what they found.  I hope they find pay dirt because my property is in athens county and not leased. 

 

as far as the second permit. who knows?  they got that back in september of last year and haven't started a second site.  Of anyone in Athens i think hayes and wolfe have the most property/benefit for it to be pay dirt.

 

best of luck

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Permalink Reply by Markus on March 18, 2013 at 9:30pm

While it is very risky (and unadvised) to compare shale plays/ formations from around the US as they all have varying characteristics, it might be of interest that the average thickness of the Bakken is less than 130 feet.

It was also noted on another thread within GMS that the minimum thickness in which a horizontal drilling endeavor could be successful is around 50 feet.  This means that the JB Hayes data point must be good for Athens County - though all must agree that more data points are indeed needed.

It has been said here before many times that infrastructure development, digestion and swapping of leases to the north and east, and actual drilling  is going to take some time.  Though, once this has occurred and infrastructure is in place, Athens will eventually benefit because the technology will continue to improve/ become more refined and desire to "sweat" the play is going to force more interest and capital allocation in what are now considered the fringes.  

Be patient Athens - your resources aren't going anywhere in the meantime.

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Permalink Reply by alan coogan on March 19, 2013 at 2:51pm

Note completion report.  Plug set, completed and producing from the Medina sand up hole.  Not a Utica completion.

 

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Permalink Reply by Landowner1 on March 18, 2013 at 12:22pm

When Cunningham Energy first came to Athens, Washington and Morgan Counties we did our due diligence and found that Cunningham was a small oil and gas company without the assets or expertise to drill horizontal Utica wells.

We went to the landowner meetings and had long discussions with Cunningham’s head landman. He eventually admitted that Cunningham was looking to gather the leases together, assign the deep Utica / Marcellus rights to a larger company, get an overriding royalty and keep the shallow rights so that Cunningham could drill the shallow wells.

He said that they were in discussions with larger companies but that if they could not reach an agreement in time that Cunningham’s owners had good contacts in the investment banking field and personal contacts with “old money” in Chicago and Minneapolis (sounds like the “old Texas oil money” supposedly behind DUX Petroleum LLC) that could provide short term “bridge” funding.

Landowners experiences with Cunningham should serve as a warning to any landowner being asked to sign a lease with a company that has limited assets or expertise. To read about another similar example go to the Help Research DUX Petroleum LLC discussion and read “The DUX Game” posting on page 12.

Unlike DUX, at least with Cunningham, the company had an address, a telephone number and some oil and gas experience. In addition there were actual employees of Cunningham at the meetings and if a landowner kept asking good questions, the head landman would eventually tell the landowner what their game plan was. It appears that none of these things are true for DUX.

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