Replies to This Discussion

Permalink Reply by Lynn Wigglesworth on October 29, 2009 at 6:10am

Hi, Brian. There has been a lot of leasing in Tioga County. I wonder how many unleased acres are still out there; they are probably scattered all over the county. I know that most of the land around me is leased (East). The East rep told me (not that I believe much of what a rep says) that they are being very selective these days and just leasing to fill in units. If they are being so selective, I wonder why they can't offer a decent deal (East is offering $1500/15/5)?

Lynn

Permalink Reply by Jay Alexander on November 2, 2009 at 6:23am

Keep in mind a top lease is worthless if a company drills or commences activities as some leases say. The one thing I see in a top lease is pressure on the current lease holder to either do something before the lease runs out, which is a net gain to the mineral owner. Based on just showing up down the road and offering an extension and some promise that never materializes.

Permalink Reply by Brian Day on October 30, 2009 at 2:20pm

Figureing out what East has in mind gives me a head ache. Most of what they have done, on their own or through other organizing agencies, seems to have been horribly deceptive. They applie for lots of permits, but do not drill nearly as much as other companies in the area. Perhaps they do not have the funding of other companies. Perhaps they will flip their holdings. They need some real competition in the county. I am not nuts over the concept of a top lease that surrenders any of my bargaining rights to a third party. I would like a hard/fast offer for my lease rights in February of 2011 for East to match. If this takes the form of a top lease with an amount paid now, to be placed in escrow, fine. I wouldn't dare spend money now that I might have to pay back later.
I think a list needs to be complied of two groups, those disatisfied with current East leasesdue to expire (no matter where located), and those totally unleased. Then maps can be drwn of potential blocks of land. Also, perhaps people with old Futurna leases might be useful because I think that both East and Futurna are subsidiaties of Talisman based in Calgary, Alberta. I am not sure how Ultra fits in the picture, nor Dominion.

Permalink Reply by Lynn Wigglesworth on October 31, 2009 at 10:06am

I don't think East is a subsidiary of Talisman (Fortuna is, and says so on their website). I know that East is a small company and doesn't have a lot of funds. That's why they reneged on a lot of signed leases last year, and I think that's why they are offering such low leases this year. But they ARE drilling a lot of wells; Delmar township has one being drilled, another with the platform done, waiting for the drilling rig (I just saw this one today), and I've heard that they are doing seismic testing for a third. I'll take less bonus money (but NOT the $1500 they are offering) because I believe that they will actually drill here soon. If you have over a year left on your lease, you may actually have a well or be in a unit before it expires.

I'd like to know how East is to deal with, as a company. I know a lot of people signed boiler-plate leases; if East is actually drilling on their property, I wonder if they are feeling abused, or East is acting fairly and professionally.Their standard lease is so short and has almost nothing in it to protect the landowner. If I sign with them, I plan to add an Addendum with the usual clauses to protect myself and to add all the things the landman promised, but weren't in the lease.

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