Chevron offer in Bullskin Twp. (Fayette County PA)

This is fresh info as of 5-14-11  Chevron land man just offered me $250 per acre per year for a 5 year lease with 15% royalties.  That is pretty lame.  Especially when I read what they were offereing in some areas only a year ago.  Anyone get any better offers from other companies out there? 

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Permalink Reply by A. J. Calhoun on May 18, 2011 at 5:44am
SW Greene County
Permalink Reply by David Detwiler on May 18, 2011 at 6:05am

A big difference between $250 and $3500.  Or is that over a 5 yr lease?  My offer also included $1100 over a 5 yr period paid up front.  Problem with that is it bumps my taxes up for one year

Advantage with taking it all at once is if they put a well on your property they stop paying for lease and just pay royalties.  If you take it all at once you already have the money in the bank.   

Permalink Reply by cjherring on May 19, 2011 at 5:45am

Hey Dave, I would not sign with them until you have talked with a gas/oil lawyer. The landman will tell you anything you want to know but ask the lawyer to filter the truth from the fiction. A lot of us, I mean hundreds if not thousands signed up with not a penny signup bonus and now the leases are ready to expire. I can tell you this, I would never consider to sign for 5 yrs. again. I have heard the rate now is around $2,000 per acre but everything is negotiable. Your lease should have addendum's in it to cover yourself and what you want, not what they want.

cjherring

0l1a6laz7smpfPermalink Reply by 0l1a6laz7smpf on May 19, 2011 at 6:53am

Personally I think it is about time that these O & G companies update their contracts and get on a standard contract (the real estate brokers in the states do)...so that both lessor and lessee rights/interests/penalties is more stated in the contract rather than hoping that you or your lawyer knows what clauses to put in an addendum.   An addendum should be used more for special requests or provisions not to be the contract.   But these O & G contracts are sooo out of date that addendums are used.  

Now if you just say...well they are going to use what contract they want rather than what is just towards the landowner.   Let me say, when I recently found that the oil company put some of my acreage in a unit (which they didn't call me to tell me and it had already been months) the representative from Chief said..."oh..you don't have a Pugh clause in your lease...too bad...as I see you used an old contract."   It is time we landowners get smarter and demand that the lease contracts be updated so that the guessing of what should be on an addendum starts being the form contract.    You lawyers out there do see what you can do to enforce the O & G to rewrite a contract rather than rely on an addendum.   If some of you don't know what I mean by a form contract standardized....just check with a reputable real estate broker and you will find that there usually is a standard contract that is revised periodically that is acceptable in many parts of your state or all and usually has a balance of fairness for both buyer or seller...so it is that the O & G leases shouldn't be onesided for the lessee...in fact the O & G companies would save much $$$$ from being in lawsuits by just updating their contract leases to give both lessor and lessee a more fair workable relationship.   There even should be a requirement that when leases are assigned that the Lessor must either receive knowledge of the assignment (in some cases maybe even approve the assignment or request monies upon such an assignment).   The assignment is normally where the Lessee makes quick money off what they bargained with you for...and in some situations you don't even know who has the lease if they sold the whole lease out.    A very important clause that 'assignabilty' clause and worthy of negotiation for  the Lessor. 

 

I hope that there will come a time when the lessee realizes that the ongoing relationship with the Lessor is the most important process of the O & G contract/drilling/profit.   How many of you that own a rental home would rent it to a renter that would not inform you when they rent it to another, make gain off your home rental amount, and would have you chasing them to find out what is going on?  and even tell you that it is your fault cause you didn't put those provisions in the rental contract with them?  I daresay none of you...yet we will allow the lessee to do these things and use our land resources?  And why don't they appropriately work with the Lessor since we both went into this for profit anyway?

Permalink Reply by Steve on May 20, 2011 at 9:41am

David

 

That is the same offer clients of mine received on Bullskin Tp property from Chevron in the last two weeks.  Looking at the drilling reports it appears that Chevron-Atlas is the only game in Bullskin Tp.  Greene County is paying more than Fayette so while I like A.J.'s offer, I don't know that it can be had in Fayette at this time.  As is widely known, there can be a wide variance from County to County (or amoung Tps in the same County).  Any other recent Fayette County offers out there?   ...    Bonus/royalty/term/company?

Permalink Reply by Ralph Wayne Detwiler on May 28, 2011 at 5:41am

Is Chesapeake Energy leasing in Fayette County, Bullskin Twp. Pa.?

 

Is any gas company leasing in that County?

Permalink Reply by Oil and Gas nightmare on May 29, 2011 at 4:19pm
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HEY MAN!!!!!! let me tell you something, the land man probably doesn’t work for them but is a contract employee if you will or maybe just a middle man or something like that(you could probable tell by the attire as well as the smarts the guys has about the future plans of chevron) it all) NOT SAYING LAND MEN ARE DUMB OR ICKY, jsut saying I would think a chevron rep, would be dressed to the T's, etc etc...ANYWAY here is what you can do, if a landman is knocking there is interest in your area, by someone... SO you can email that company yourself to make contact and I suggest calling too. AND YOU WILL get a response if chevron was really interested in the land.  MAKE the letter as informative as possible to make it easy for them to make a "decision" to look into it.  Remember they are very freakin busy right now.  SO include parcel numbers, addresses, amounts of land, AND MOST IMPORTANTLY, tell them the parcel numbers of land around you that they have leased and the directions for that land from the parcel they have already(ex: N/NW of your parcel #123445.) go to the DEPA website, look at a link called efacts..from there you can put in you county and township and search ALL permits in your area and it has the farm name as well.    If that works for you, then see whom has leased the land(its on the permit) and then you know who is leasing around you.  When you find that out, then you can approach them with confidence that they would like for you to be a part of what they are doing more than likely....NOW if you cant find out who is leasing up properties around you FORSURE(cause ppl say a lot) that way,  Then go to the tax assessors office for your county get a map with your parcel in it, just so you can scribble in leased lands and the company they are leased with.  Then go to the court house, search all the lease in that area. Some counties have this online,   GET those leases, color in those parcels by the gas company that has them leased around you and then  you can see how many options you have to contact to actually get a well up and bonus.  I for example did that, and found out there are three companies on varying sides of me that I could lease with depending on which way i want to go, and then each of those 3 companies have enough land on that farther side of each property of mine to be down with leasing my land.( meaning it gives them a little more land to add to their unit).  I apologize if you already know all of that but I just want to help ppl get the best and FAIR amount for their land...THEY are now after Marcellus and Utica, which is gas and OIL and so I would laugh in his face until I cried at that kind of insult!!!   DO NOT LISTEN TO BS ARTIST THAT SAY ITS NOT TRUE!  read my UTICA post and all I have found I didn’t even put up everything, they are looking to get OIL and GAS from you, and Chevron can more than afford it, so do all your homework and get something in the hands of someone there at chevron, or whoever is around you and then see what they offer, and if its the same say a big FU and close the door in their face, because I PROMISE YOU THERE ARE PPL GETTING WAY BETTER DEALS...as they should for freaking OIL and gas... sorry to ramble hope I helped

Permalink Reply by Steven A. Walton on July 24, 2012 at 10:23am

Has there been any leasing activity recently in Fayette?  The DEP's website shows a lot of recent new permit applications, but it looks to be for new wells on existing units.

Permalink Reply by Audrey on July 27, 2012 at 1:02pm

I have about a hundred acres and I turned down $800 an acre last year and $1200 this year.  I think Bullskin folks deserve the going rate just like all the others.  I'm connected to a Pgh lawyer by the name of Zimmaro.  He also feels we can do better.  I'm waiting it out.  Good luck to you.

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