"Fang's Agenda"

Yes he is obtuse, yes he speaks his mind, yes he can be an A%$hole, but he is the landowner's $%#&^*$.

He speaks for us.

I have followed Fang's post from when he first appeared, who is he, it really doesn't matter to me because he is never personal and he debates obviously with facts and knowledge.  What I know about him from this site is he is an old timer landman from the days of the first clinton wells.  He is a veteran of urban unitization which is the toughest part of the well unit development.  He is very experienced in my book.

 

Now many here question his agenda when they no longer can debate.  Let me tell you what I see as his Agenda, it is the same as mind and the same as landowners and the same as professional people in this trade.  We and Fang are outraged how those who never understood a clinton well royalty check, never managed real estate, those who's knowledge of a lease was an apartment lease............those who jumped up and preached to the masses who owned land that they could represent them in this once in a life time gold rush.   Yes we have an agenda to see justice for fellow landowners and the RETURN of the professionals in the continuation of this energy development.  The banishing of those who unjustly enriched themselves at the expense of the landowner, big or small.

 

Fang's Agenda IMHO is the same as Jack Straw, Marcus, Townsend, Brink, The oil patch man, all of us who post and learn here everyday, just local community folk.

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Replies to This Discussion

Permalink Reply by Keith A Williams on March 15, 2013 at 8:46am

Mike,

Very well said!

Many landowners take the best offer that is on the table at that time and then later see better offers come along. They did NOT get taken. They did not leave money on the table, it was not there!

Your $ per acre price is determined by the terms of the lease.

As far as unit size goes, that was a negotiation point. You want a small unit size, the oil company may be willing to give you less per acre (or nothing as it is not worth their time).

You want to exclude certain formations, again it's worth less to the oil company.

No surface use same thing, Horizontal Pugh, Vertical Pugh, I could go on.

Remember they have to drill (or sell) these acres to make money.

IMHO

Keith

Permalink Reply by Mike Knapp on March 15, 2013 at 9:02am
All true Keith. As far as unit size goes, companies have a long term and (some) landowners have a short term view. When there's only one well on a large unit, people may not be bringing in huge checks. But that large unit will enable much less surface disturbance and will leave much less gas stranded, which is ultimately good for all parties. More profits and less cost means a company will have more money to pay out when leasing, and can afford to pay higher royalty percentages and still remain profitable. Or be able to continue to drill in a low price environment. Our company doesn't pay out massive signing bonuses and giant royalties. But because of that we can drill at low gas prices, and most of our landowners would tell you they'd rather have 15% of something than 18% of nothing.

What some landowners view as being screwed is just gas companies taking the long view, and trying to be as efficient as possible. Can you really blame them for that?
Permalink Reply by Ron Eiselstein on March 15, 2013 at 9:12am

So Mike, you are a company man.  Why are most of all the units developed in the Utica around 200 acres and not 1000?

Permalink Reply by Ron Eiselstein on March 15, 2013 at 9:25am

Mike, really, if you verified that you work for an energy company in prior exchanges, forgive me if I forgot.  Many of my post here strongly supports energy companies.  The question of 200 acre units as far as I can remember never really had a rational answer, so shoot.........

Permalink Reply by Ron Eiselstein on March 15, 2013 at 9:14am

Keith with due respect, if you honestly tell us your vocation, we will understand your opinion.

Permalink Reply by Mike Knapp on March 15, 2013 at 9:21am
Is that an honest question or one you already know the answer to Ron?
Permalink Reply by Keith A Williams on March 15, 2013 at 10:24am

Ron,

My Vocation, I am presently taking care of my 87 year old mother with alzheimer's. I own a half interest in 236 acres. I ran a ~ 5,000 acre land group. I am in the middle of signing a Pipeline agreement.

Question, if someone disagrees with you, do they "have to be" a company plant?

I believe I am looking at a bigger picture. I had to do a lot of that in order to lead a group. I had to look at the lease from both sides and come up with a compromise. A lease that my group could live with and one that the company would accept.

IMHO

Keith

Permalink Reply by Ron Eiselstein on March 15, 2013 at 9:30am

Strange... Jack Straw just gave all of us a succinct rationale why energy companies want vast acreage units and now you as a company man is slipping in a paragraph of why large acreage is required.  I think you need to go deep and answer Jack's education in par.

Permalink Reply by Mike Knapp on March 15, 2013 at 9:44am
I said nothing of the sort. I said that larger units are more efficient. And they are. There's more to units than making sure royalties are fairly apportioned. I'm supplementing what Jack said, not contradicting it. I would think that folks here would value that perspective, and I've never hidden my job title. Me thinks that if the other side understands why the gas companies do what they do, they won't just assume they are getting screwed.
Permalink Reply by Ron Eiselstein on March 15, 2013 at 9:53am

I understand Mike, I remember you from the beginning of this play here and you have always been a stand up guy.  Also having industry folk like you here is really needed to so continue to give us your professional advise.

Also keep in mind that many of us here feel it is not the energy companies that we need to worry about, it was individuals that saw a chance to take advantage of the situation.  Again, we are not touting landgroups to unite against the lessee, more so for direct one on one negotiations with you guys with professional assistance, but I have said all this before.

Got to go offline so have a nice weekend. 

0i7okn54zwbdoPermalink Reply by 0i7okn54zwbdo on March 15, 2013 at 9:57am

Mike, you need to remember that at their core most people are greedy and inherently selfish.  Never is that more obvious than when there are boom times.  So everyone thinks they got screwed if they can point to someone else and say "he got more than me!".  It's just the nature of these things.  Thanks for the information and keep up th good work.

Permalink Reply by Jack Straw on March 15, 2013 at 10:14am

RE: "Maybe my mama raised me different, but I find it hard to associate someone giving me a substantial amount of free money as getting screwed."

"Free money", an interesting concept.

When a landowner signs over (via a lease) a vast majority (80-87.5%) of the Landowner's Oil & Gas interests for compensation, I would not categorize this as "free money".

Were you to sell your car for a certain sum of money ... would you categorize the proceeds as "free money"?

When an O&G Company "purchases" a lease, do they refer to that expense as giving away "free money"?

Should an O&G Company sell a lease to competitor, how do they book the proceeds .... do they book it as "free money"?

"Free money", an interesting concept.

I look at things differently; when a landowner signs over (via a lease) a vast majority (80-87.5%) of the Landowner's Oil & Gas interests for compensation, I would consider this transaction as one in which monies (real monies) are transferred in a transaction where the Landowner "sells" an asset that both the Landowner and the purchaser consider to be of real value. To me, characterization of these monies as "free money" is an insult to the Landowner, and represents a lack of respect for the Landowner.

I have yet to witness an O&G Company handing out "free money".

When an O&G Company hands out money, there always seem to be strings attached.

If anyone knows where and when "free money" is being handed out, please let me know - I want to be the first in line, so I do not miss out.

 

Maybe my mama raised me different, for my mama told me that there was no such thing as a free lunch (and I suspect that was in reference to "free money").

You might want to go back and talk to your Mother, you seem to have missed at least one lesson.

 

All IMHO,

                    JS 

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