Disturbance fees for an access road...how much

Had a meeting with CHK this morning working out the details of a proposed access road thru our property to a well pad just off our land. The rep was a nice enough guy and very informative. The road is about 400' long and about 25' wide where it crosses. There is also a bit of "disturbance zone" where the pad comes right to our property line. They had the total at 1.5 acres and are offering $3000 ($2000.00 per acre). He says this is all they offer but seemed willing to accommodate a us in a few other areas like graveling our driveway (1300' long).

 

Does this seem about right or are they low balling us?

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Permalink Reply by Greg on June 6, 2014 at 3:15am

The attorney said their offer was in line and I really had no choice but to accept it. I tried to get a few little concessions and was told the project manager would work with me but they would not put anything on paper. Sooooo, I am probably SOL. We will see. They are going to start the pad by the end of June.

Permalink Reply by INVICTUS on June 8, 2014 at 2:46pm

I'm curious why you feel you even have to take this road? Do you want to take this road? Are you contractually obligated?

Permalink Reply by Jack Straw on June 8, 2014 at 3:48pm

I second INVICTUS's comment.

$3000 for 1 1/2 acres makes for very cheap land.

An easement is FOREVER; and you will be liable for property taxes on the easement, forever.

It's presence will negatively impact the value of your adjoining land.

You lose control of who has access to your property.

Have you insisted on locked gates at either end?

Would it become attractive to idiots on ATV's (I speak from experience).

Even if you get locked gates, on a cold February day, a well tender will unlock that lock and give it a pitch into the snow .... so much for locked gates .... they never stay locked.

Also, idiots in 4 wheel drive trucks and ATV's will drive around the gates .... some 16 year old does something stupid (have you ever seen a 16 year old that did'nt do something stupid, present company included).... and ends up in a hospital (or worse) ... who will they sue .... that's right, YOU.

Insist on full indemnification which will protect you from any liability for any entry to your property via the easement (authorized and especially unauthorized).

$3000 is too little; would you sell a 1/2 acre frontage lot to someone who wanted to drag in a doublewide ... for $3000?

I would push for whatever 1 1/2 acres of land is worth x a factor of four .... with indemnification ... and with the agreement that the easement is only for vehicle access .... and with the agreement that once it is no longer used for its original intended purpose (access to a well pad), the easement reverts back to the landowner (you do not want that easement to be forever).

I like the idea of annual rental (five years at a time, renewable, paid up front) ... of course, with full indemnification ... you need to be aware that the worst possible case is always a possibility.

Even if you have a contractual obligation, that does not mean that you should not obtain adequate compensation and legal protection (indemnification).

If they intend to "start the pad by the end of June"; they need to come to an agreement with you ... I do not see that the onus is upon you to settle on THEIR terms.

RE: "The attorney said their offer was in line and I really had no choice but to accept it."

I humbly suggest that you need to talk to another attorney.

I hate to see landowners walked all over ... especially by CHK Landmen from OK (wearing cheap pointy toed cowboy boots and big belt buckles).  

All IMHO,

                  JS

Permalink Reply by INVICTUS on June 8, 2014 at 11:42pm

Greg, Don't be afraid to fire the current attorney (gracefully, of course) and get another opinion.

In my experience (and I AM speaking as a non-legal person), most ATTORNEYS don't know the necessary detail about oil and gas law.

A similar example: you need a heart transplant - are you going to a general practice doctor for this?

Again, who told you that you even had to take the road? What is their legal reasoning? Or what legal language in the lease are they using?

And what is the "offer was in line" thinking? who "sets" these prices for you?

Is there an open market with price discovery whereby going rates for these kinds of things can be readily determined?

(J.S. now has ME fired up Ha HA)

CHK will get its pockets filled with cash. I want you to get your value (or keep your land untouched if that is what you want) as YOU feel is fit.

Permalink Reply by Kathi Albertson on June 9, 2014 at 1:21am
Greg,

I agree with the others that you might look for another attorney. I am currently being paid $5000 a month per acre for a pipe yard. In two months it will be reclaimed back to the way it was and I am ahead over $15,000. And they want you to take $2000 an acre forever?! That's crazy!
Permalink Reply by Greg on June 9, 2014 at 2:07am

Thanks for the input, but it's over. Offer accepted.

Permalink Reply by Finnbear on June 9, 2014 at 7:11am

Ouch! That must hurt - or it will later.

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