Renegotiating royalty percentage agreement.

Our gas company wants to increase our unit size 10%.  I feel my relatives got the "short end of the stick" when they signed their Royalty agreement at 12.5%!   We would like 15%-18% if we agree to allow them to increase the unit size. The gas company says no way. If my relatives don't agree to the unit increase the gas company may just abandon the other wells that have not been drilled. I believe this is a bunch of scare tactics.  Now my relatives are afraid they could lose any royalties in the future.  Has anyone been successful in renegotiating royalty agreements?  I believe that if the gas company wants to increase the unit size, that is so that they don't have to construct more pads and drill more wells, thus saving them millions of dollars!  All we want is a fair deal!  Please advise, Thank you.

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Permalink Reply by Kathleen on March 11, 2013 at 12:30pm
I forgot about that. You are correct, many leases, not all state a 10% larger unit size is automatically granted.
Permalink Reply by john on March 14, 2013 at 5:28am

This was attempted in Sullivan County Pa with landowners, and the company was

very emphatic about not reneg. and never did.  This was 3 yrs ago, they did not

abandon, but they are not paying the big bucks either on expired leases

which they are renewing.  It's a crap shoot.  "a bird in hand is better than

a bird in the bush:.

Permalink Reply by Billy Park Whyde on March 14, 2013 at 6:53am

 All birds roost in good time. A few other ideas on this is .

1. If the depletion as bad as some are saying the bird will need a new roost earlier.

2. Larger markets and demand can possibly increase the demand.

3. Drilling into other formations might be a menu  for demand.

Permalink Reply by john on March 14, 2013 at 10:27am

IF THEY DO BUDGE FOR YOU, YOU WILL BLABBER MOUTH IT AROUND AND

ALL THE OTHER 12.5% WILL WANT TOO.  THEY AINT GONNA BUDGE.

BUT IF THEY DO, BLABBER MOUTH IT AROUND, HA!

Permalink Reply by melvin t morris on March 15, 2013 at 3:02am

I too had same offer with CHK in Cherry twp Sullivan cty. They wanted to double size from 620ac to 1,340ac.I requested the same percentage as some neighbors received who signed a year later, from 16% to 20%.They did not approve and eventually sized the unit at 602ac. In the end, they only included 1/2 acre out of my 30 acres in the unit just to hold the lease, which would have run out in July 2013. My lease had a clause where unit size could be no more than 620 acres.The balance is still not in a unit. Its a one way street with them.

Permalink Reply by john on March 15, 2013 at 3:25am

they are business people out for their own interests. they take the risks.

i was at the meeting of landowners at St Francis church in Mildred 3 yrs ago and

the owners were really upset with Chspk, but the speaker held firm.

Permalink Reply by Richard Droske on March 15, 2013 at 8:14am

But no one ever shows real evidence of water damage and the land usage is what you are being paid for.

 

Please don't bring up that propaganda movie. People have been having problems with gas in their wells way before fracking even existed. Entire homes in Pennsylvania have exploded way before this drilling started.

 I have noticed that the people who have tried to complain that the fracking has polluted their wells have quieted down lately.

Perhaps because they have no case and the gas companies found evidence that they had water problems before drilling began?

Personally I would not use well water without purification or detailed testing in the first place as the danger of contamination from natural sources is large.

 

Anyone claiming that fracking is causing their problems should be required to provide proof that they tested their water previously.

My opinion so far is that those making these claims have had bad water all along and are now just trying to benefit from this fact.

Can anyone post evidence of any property owner winning damages due to well contamination or any other problems? Or even finding a lawyer willing to take their case?

 Any evidence against my opinion is welcomed.

Permalink Reply by john on March 15, 2013 at 12:29pm

this is the latest line from AD:

"we realize that fracturing fluids do not leak into the aquifer, it is methane

from the shale above the aquiveers that does the damaage".  Have you seen the YOUTUBE list of the Dead & INJURED  from fracturing.?  almost 900 folks.

it is almost done tongue in cheek.

Permalink Reply by Richard Droske on March 15, 2013 at 12:49pm

You suggest Youtube as evidence? Sorry but that is just silly. If these people were truly harmed by fracking lawyers would be jumping all over this. Show me one case even filed let alone won or you are just talking drivel.

 

Once again people who drill wells in this area have been getting gas in their water for decades (if not centuries). I have yet to see anyone show that they had good water and it suddenly went bad after a drill was done.

 

Until I see this all of this talk about the "hazards" of fracking are just paranoid rants from people who have nothing to gain from the bonanza.

 

The claims they make on environmental reasons are also disingenuous.

 

Gas is by far the cleanest fossil fuel and also our best chance to escape our dependence on imports of oil from Middle Eastern oil pumping terrorist supporting dictatorships.

Permalink Reply by ji on March 18, 2013 at 1:23am
Permalink Reply by Richard Droske on March 18, 2013 at 3:40am

Settlement where neither party will talk? Perhaps just cheaper for company to buy off people who had bad wells all along? Certainly no evidence of damage from fracking here.

Permalink Reply by john on March 15, 2013 at 12:31pm

you are right, drive a hard bargain, ask, read, seek professional advise.

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