Royalties >>> How much per acre in a monthly royalty check

How much per acre in a monthly royalty check ? Certainly it would depend on a few or maybe many factors ..... but give examples if you have them please.
If someone has the figure for drilling in a section ( say about a square mile or 640 acres ) and how many wells were drilled ( horizontal or verticle ) we could then do the math for the size of our acerage included in the section. Or for others who may own many sections etc.

Views: 39935

▶ Reply to This

Replies to This Discussion

Permalink Reply by Jean Michel LeTennier on January 12, 2010 at 6:57am
I am told by some friends at Chesapeake it's considerably higher than that... based on the existing production units in northwest PA...
Permalink Reply by Jean Michel LeTennier on January 12, 2010 at 6:57am
Sorry North East PA
Permalink Reply by L O'Grady on January 12, 2010 at 7:16am
Sorry but all of my research and info tells me that your "friends" at Chesapeake are blowing smoke up your wa-hoo. And I also know for a fact that they LOVE when a "friend" like you gets on these discussion boards and gives uneducated helpless landowners very high but extremely false hopes by throwing out such big numbers. Sorry, but unless you can conjure up some reasonable math and back up those figures, I advise all people reading this:
DO NOT BELIEVE IT!

I honestly hope you prove me wrong. I would love nothing more than to see my neighbors make that much money from this.
Permalink Reply by Jean Michel LeTennier on January 12, 2010 at 7:22am
Well, at this point neither of us has produced any numbers or sources for those estimates of yours.. And please keep in mind we are only talking about the Marcellus Shale formation here, what most land owners don't know is that in several areas of the Lower Tier of NY there are at least 7 other shale formations, some even larger than the Marcellus.. and those have not yet been even appraised yet...
so at this point, it seems you are the only one blowing Smoke.. as it were..
Permalink Reply by Bonnie M on January 12, 2010 at 7:41am
And as everyone knows, you don't count your chickens until they are hatched. Any money that our land pays us back is greatly appreciated in this household. You can not take hopes and dreams to the bank so we all have to wait and see what it brings for all of us.
Permalink Reply by Jean Michel LeTennier on January 12, 2010 at 7:54am
Very true, and we see it here every day with properties being auctioned off.. at least 2 a month by me. There is hope though, based on all the mergers and aquizitions and entry into the Market of the Large Oil Players (Exxon, Total, Elf,BP, Hess etc that Drilling will finally commence and stop all the hemoraging of homes to the Banks. That does not mean that peole should be uninformed as to what lies beneath their property.. THE UTICA shale is 5x thicker than the Marcellus and covers most of NYS, yes less gas , Maybe but certainly recoverable. The oil companies have spent almost 75 Billion dollars aquiring properties and leases in the last 3 months and there are more on the way..
They are not coming for no reason..
here is a website that list all the known shale plays in the Country, compare NYS to every other state...
http://tin.er.usgs.gov/geology/state/sgmc-lith.php?text=black+shale
This should make it easier for people to understand why they are coming...
Permalink Reply by L O'Grady on January 12, 2010 at 8:05am
Well I sincerely hope you make enough money to go buy another home b/c you will not be able to live in yours in about 2 or 3 more years. These "leases" are not just for 5 years or hoever long your lease says. They will be held by production for as long as they want to be, and if there is as much organic-rich gas as their geologists say there is, they are there forever, drilling 24 hrs a day, and when the Marcellus dries up, then they will be digging into the Trenton Black River which is underneath, etc... What most landowners don't know is to include that in your original lease b/c if you didn't they won't owe you a dime when they continue digging. I'm not a tree hugger at all, I just want everyone to get the deals they deserve. I do believe it's worth it to lease for the RIGHT PRICE. But many landowners signed a standard lease that left out significant info. And whatever the O&G Co.'s left out of the lease, they are allowed to do b/c it's not limited by the lease. It's exactly why they pay you as they do. You get the bonus payment first, and then the royalties eventually start coming but unless you own more than 500 acres or so, it's not nearly as much as you think it'll be. And please don't bother fixing up your home or giving it back to your community, your property value is now $0 and there will be no community in about 5 years. Just be smart with your money. Get as much as you can and RUN!
I really am happy for anyone that has made a good profit from this, but at the same time, I am sad for those who didn't get what they deserve, b/c they will be forced out and they will have nowhere to go b/c they can't sell their land.
It is precisely the reason we have not signed yet. I wish our neighbors weren't so quick to sign, we would have been much stronger if we joined together as a group and signed. For us, it's not our primary residence, but for many of our neighbors, it is.
Permalink Reply by L O'Grady on January 12, 2010 at 8:08am
And by the way, Jean, I never mentioned any numbers or estimates.
Permalink Reply by Jean Michel LeTennier on January 12, 2010 at 8:16am
All that you say may bb true, but there's never a problem without a solution... Yes, we will have to move, based on what I have seen in Wyoming and Texas(visited friend there), but this will actaully incease the value of my existing Property, because , It can be rented out at a much higher rate, and I can build 3 additional home if necessarry(checked already with zoning) and rent those. there will be an influx of up to 100,000 or more people moving up here,and there are no apts for rent.. The companies will be paying top dollar for living space as well.(executives and managers don't live in worker camps). Last Year PA added 130,000 new jobs 2009. I will hate leaving my place but I am now looking for something else and if anything, this place will be paying me double time...
One thing that landowners I believe should be clear about, this is all about Economics and they should look at it that way.. They have an asset that can set them free for life, maybe not where they live now, but certainly somewhere
Permalink Reply by L O'Grady on January 12, 2010 at 8:41am
I hope you are right. Although I don't think the executives will want to live that close to their wells, seeing as the water and land is definitely contaminated. But I'm sure they won't have a problem housing their poor, uneducated migrant workers in your rental homes. There's a reason why you don't see houses in the background when you look at pics of big Texas oil fields. Many O&G bottom rung workers will actually be housed within a compound they plan on building, so I hear. And you can definitely expect your crime rate to increase 20-fold in your township if your house is in as rural as an area as mine from these migrant workers. Just things to consider...

Here's a good article to read for anyone interested:

http://yubanet.com/usa/The-Marcellus-Shale-New-York-is-the-Natural-...

And here's another:

http://un-naturalgas.org/weblog/tag/lease/

In so many words, it's a double-edged sword. I just hate that for one well, Chesapeake could make $50 million, when the one who owns the land will make maybe $500,000. It's downright insulting.
And although our property taxes are not projected to rise due to this, the income tax certainly will, so we will be paying it right back to the state and federal government, which is almost completely run by these oil companies. We can thank Marcellus and Barnett for rebounding our nation's economy.
Permalink Reply by Pam S on January 24, 2010 at 1:11pm
I actually tried to get stratispheric assignment in my lease so that they couldn't get into the black river without paying me for it. I wanted them to be able to just drill into the marcellus. They wouldn't go for it. They wanted all or nothing. I think we will still get the royalties however from the black river. I really wanted to wait to sign (still haven't yet but have an offer for $5500/acre and 20%) but I have a daughter that will be going to college in a few years and a bird in hand...
Permalink Reply by Jean Michel LeTennier on January 24, 2010 at 1:27pm
Hi Pam,
LO'grady is right about them making a killing.. and yes even if they go below teh marcellus and tehy will.. , it willtake them more than 5 years to do so, and new round of negotiations can take place ar far better terms.. Certain new leasing being signed in Louisiana now are over 25,000$ an acre and 28% of what comes out of the groundd, but these are for producing wells...
so I look at it this way. with 7 differant shale layers by us, these wells wil be producing for 30-50 years and mayber more as teh technology gets better thye weill revisit teh 50-80% they left in teh ground.. Take the bird in the hand, but try to limit your lease to 5 years increments.. this my thought on all this..

RSS

© 2024   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service