Old Leases in SE Ohio

Hello all,

Our property has two producing wells leased since 1977 by a small outfit. Is it likely that these lease rights might be purchased by a larger company for any deeper drilling for the Marcellus shale?

How likely would it be that we would be informed if this happens?

Would they need a new lease to drill deeper or horizontally?

It seems odd that we have been approached by landmen, even though they know our wells are already leased.

We are having trouble finding information on the "what if's' concerning already leased and producing wells  that are operated by the little guys. We would appreciate any insight.

Thanks, Kay.

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Permalink Reply by WLW on January 17, 2012 at 8:48pm

Kay

Which county are you in and who is the producer?

I have been reading that even the shallow wells still hold the lease and it just needs to be re-negotiated. We all need to be very careful with whats going on with our leases. I have 2 deep wells that hold some of my land. One, there is NO way I can ever get out of it. Learned the hard way on it. The other, is NO good to them as it cannot be unitized, yet it has been transferred. Working on it at this time.

Permalink Reply by Philip Brutz on January 17, 2012 at 9:15pm

They will probably try and get you to sign a new lease allowing them to put you in a large unit.  They will not offer you more money, but threaten to drill around you if you don't sign it.  Talk to your neighbors, there is strength in numbers.  Maybe if there are several of you in the same situation you can negotiate better terms.  Do not sign any thing that you do not understand.  Talk to your lawyer.  I would not sign a lease that had the words "Convert to Gas Storage" or "Waste disposal injection well" in it.  On the bright side if you are in a wet gas area the royalties could be good even at 12.5%   

Permalink Reply by Lynn mudder on January 17, 2012 at 10:32pm

Philip, you are totally correct.  CHK has leased our deep rights from a shallow well that we have had since the late 70's, they want us to change the size of the unit from 40 acres to 640 or 1280, but will give us NOTHING.  No bonus, no better royalty.  Same song and dance, we will go around you or take it out from under you if we can get close enough.  This is business, but they are not a very good partner.  This is Mahoning County, Oh

Permalink Reply by Kay Bee on January 18, 2012 at 1:10am

Thanks,  we are in Washington County.

Permalink Reply by WLW on January 21, 2012 at 7:12pm

Cobra

Yes we read the post, but not a one of them shows a lease, including the link you posted. We are in Washington county, and G&R bought a lot of well SITES here several years ago, which from what I am hearing did not include the leases. That is the case with a lot of the wells here. They were HBP and sold as 10 acre well sites only. So G&R is holding the lease for the companies they bought the wells from. There are also companies selling/assigning leases they don't even own. If you look closely on the Landaccess page, you can find SEVERAL wells in our area that 2 different companies have transfered the same thing to 2 different drillers. Same depths and acreage.

We all need to be watching closely as it is happening without notice.

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