Recent Offers in the Marcellus Shale

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1. State
2. County
2. Lease Bonus Offer
3. Royalty %
4. Terms (length of the lease)

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Permalink Reply by MonBel O & G Landowner Watchman on December 15, 2010 at 7:54pm
Mike, if we search the net we see where a Wyoming County Land Group leases part of their holdings for 2700 per acre bonus in Sept of 08. In Sept 09, the remainer and additions to the group signed for 5600 or 5760 per acre bonus.....did you not belong to that group or what was the situation?
Permalink Reply by Elnathan Cory on December 17, 2010 at 3:22am

Think of it this way. There is certainly going to be too much water in the water cycle in the near future due to the release of trillions of gallons from glacial melt caused by global warming. This is and is going to cause rises in ocean levels much to demise of coastal areas. By taking some of this overabundance and pumping it into the Earth during fracking and leaving it there we are helping to postpone this catastrophic event. I know this is a divergent way to look at this but it is true. 

Permalink Reply by Joe Smith on December 17, 2010 at 4:21am

Gee, you need to be a PR Rep/damage control for the Gas Industry and get paid for that kind of information.

Permalink Reply by Elnathan Cory on December 17, 2010 at 4:55am

There is no long term water shortage in the East. The Marcellus wells should not affect the ground water except to use it. Frack water can be reused!

Permalink Reply by Joe Smith on December 17, 2010 at 1:21pm

Wait a second,  is it not the carbon fuel burning that is causing the melting of the ice caps?  And, we are going to escalate the vicious cirlce by pumping the excess water down the wells to release gas to burn and power the grid and melt more ice?

Permalink Reply by Sam Douglass on December 17, 2010 at 4:16pm

For what is worth to this important, but possibly irrelevant, discussion - I have heard some other planets are warming up in a similar fashion to Earth and the cyclical heating up of the sun is the suspected cause.  Just in case they might be wrong, I occasionally turn off a light to save a little energy and probably affect the oceans to some extent.

Permalink Reply by Joe Smith on December 18, 2010 at 2:44am

Irrelevant is right.  We all support gas drilling and we are talking about something that Carol M brought up and that topic was not even suppose to be discussed in this forum.  She jumped in and out and is now laughing.  We are to talk about leasing and how the Marcellus landowners are selling on the cheap due to impatience and fear.  Here again, Carol M keeps promoting fear among the land owners on the various forums.  We are at the beginning of the boom.  Just a few years ago, a very small percentage of the population even knew that they were sitting upon a large gas field.  We need to take a good hard look as to what is a fair price and will economics eventually drive the price up after another year or two of development.  Primary things to take in to consideration:

Infrastructure  (numerous pipeline projects will be completed by 2013)

Supply (Lucrative Wet & dry Gas/numerous gas fields located in one basket)

Demand  (numerous coal power plants are switching to gas by 2013/new ones built)

Politics (regulations/guidance/$$$ continues to support the industry)

Technology (continues to improve production and safety/silences the activists)

All of the above makes positive speculation vice negative a whole lot easier to support.

Adding another zero to make five figure bonuses a reality and 20% royalty or more is not out of reason! 

One of the best techniques that the landmen are using is the fear factor of being passed over.  The spud wells are going in all over.  The landmen focus efforts around the vertical well and place fear in the entire future gas unit that is being formed.  Construction of roads are taking place, rig moves in, sound of the drill and landonwers think they are missing out.  All the while, the landmen know its just a test well and they are using it as leverage to make the the landowner think they have to make a quick decision within days and weeks.  Think about it, how can the unit be going on without you?  Surveys and permits would of had to included you if they were going lateral underyou.  You control the negotiations.  You have the gas they need.  They need you for the piece of the puzzle to complete their unit.  It is not the other way around.  The gas company will create a unit by buying the leases and then start the permit process once they have a concrete drill plan to submit.   If you have at least 40 acres of property, this holds true.  The more acres, the more they need you and going around is not an option.  They need your land for pipelines, storage (all negotiable for money too) a  long hold out literally places a hold on their plans and time and time is a greater loss of money to them rather than to increase your bonus/royalty.  They will negotiate after trying many tricks first, i.e. many mistakes in the lease, give you what you want in writing only to change it later when submitted and you have to start all over. After coming to you, now not interested in you? Wording in their favor, i.e. post deduction costs, all gas under property etc...  Many more techniques used than I can ramble on about.  The bottom line, Pa landowners can achieve five figure bonuses and 20% or more royalties!  A Quote from Exco CEO, "On average, we pay anywhere from 1k to 12k on bounus and up to 20% royalty." (Note: My brother-in-law got 21% in a quiet deal from the same guy) I ask, where will you fall on that line?  Remember, land owners are not openly releasing their final lease figures.  We hear the figures mainly from companies and large land group deals made public.  However, the story of the individual hold outs that were paid well so that the gas companies could complete their units goes untold. 

  

 

Permalink Reply by joe on December 22, 2010 at 7:47am
SO EVERYONE IN OUR GROUP IS AWARE IT WOULD APPEAR CHIEF HAS SOLD ACREAGE LEASED IN SULLIVAN COUNTY TO THE PUBLIC COMPANY EXCO. IF ANYONE WITH A CHIEF LEASE RECEIVES CORRESPONDENCE THAT THEIR ACREAGE WAS INCLUDED IN THIS TRANSACTION IT WOULD BE HELPFUL TO THE GROUP.
Chief Oil & Gas Announces Agreement to Sell a Portion of Its Marcellus Shale Assets
Tuesday 12/21/2010 5:39 PM ET - Pr Newswire

 

Related Companies



Symbol Last %Chg
XCO 19.45 0.70%
As of 1:37 PM ET 12/22/10

Chief Oil & Gas LLC ("Chief") and Radler 2000 Limited Partnership ("Radler") today announced they have entered into an asset purchase and sale agreement to sell certain
natural gas properties in the Marcellus Shale to EXCO Holding PA, a
subsidiary of EXCO Resources, Inc., for approximately $459 million. The
sale assets include 15 producing wells, 11 wells waiting on completion
and approximately 50,000 net acres located primarily in Lycoming,
Sullivan and Columbia counties in Pennsylvania.

(Logo: http://photos.prnewswire.com/prnh/20101108/DC97134LOGO)

"We are pleased to enter into this transaction with EXCO, which previously joined with BG Group, plc in a joint venture to develop its Marcellus holdings," said Chief's President and CEO, Trevor Rees-Jones.
"After the sale of these properties, Chief and Radler will continue to
own over 287,000 net acres of Marcellus leasehold in a gross position
covering approximately 500,000 acres, and we are enthusiastic about
continuing to drill and develop our acreage in this world-class shale
play. We believe this position holds substantial natural gas reserves,
which can only grow in desirability as our nation turns to
readily-accessible, abundant and clean-burning natural gas as the
primary fuel of the future to grow our economy and support our nation's
security, employment and standard of living," said Rees-Jones.

"Chief employees and Chief offices in Wexford and Williamsport, Pennsylvania will not be affected by the sale. Chief's midstream subsidiary, Chief Gathering, will also not be affected and will continue
to develop its planned pipeline infrastructure in Pennsylvania. The
proceeds from this sale will allow Chief to expand its development
efforts in northeast and southwest Pennsylvania, West Virginia and
Maryland," Rees-Jones continued.

Chief Oil & Gas has drilled 95 wells in the Marcellus Shale in Pennsylvania and West Virginia and will remain one of the largest leaseholders and most active operators in the Marcellus Shale. Chief
plans to exit 2010 as operator of 9 rigs drilling in the Marcellus, not
counting non-operated interests owned in leases and units being drilled
by multiple rigs operated by others.

Permalink Reply by Sam Douglass on December 23, 2010 at 5:00am

Some good content

Break up your paragraph so it is not so exhausting.

Permalink Reply by Mike C. on December 22, 2010 at 10:35am
This is supposed to be a discussion about Offers in the Marcellus.  Lets please keep it that way.  If you would like to start a new discussion please do it outside of this one.
Permalink Reply by joe on December 22, 2010 at 10:37am
Mike EXCO offered Chief close to $9,200 an acre...what am I missing?
Permalink Reply by Mike C. on December 22, 2010 at 10:39am

Your post if fine.  But the pages of back and forth about global warming is getting old.

 

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