How are the surging natural gas prices affecting drilling this year, and what about going into 2022?  Are the gas companies taking advantage of these higher prices?  What`s next?

Views: 60999

Reply to This

Replies to This Discussion

Farmgas check out RRC new presentation .. They are bringing back to life the NW corner of PA .. RRC has not mentioined this region in years 

I did check their presentation and I`m too surprised at the NW PA presentation.  For many years I considered this area to be off-limits for further gas development by gas companies including RRC.  Looks like they only would consider it for Utica/Point Pleasant w/NGL potential.  Since they mention EOG I would suggest following their reporting which Range is showing  interest based on their success.   Secondly, Range doesn`t seem too interested in drilling Utica wells in SWPA so this area could become their Utica zone.  Something to check is the depth for Utica in this area.  It may be at a shallower depth then in SWPA, and if so, means less drilling costs.  SE Crawford County & NW Venango County appears to offer a sizable chunk of acreage for them.  Thanks for noticing this news for Range.

Any GMS members with knowledge of EOG in Ohio or RRC in NWPA?

This RRC discussion dovetails into another discussion about EOG in Ohio here in GMS.  Something to further follow along with.  Might be something for GMS members from NWPA to follow.

I have to ask--landowners are getting free gas? Why did I not know this before today? 

In the older shallow well gas leases most provided "free gas" to property/landowners each year.  From my experience this free gas amounted to 200,000 cf/year.  This gas was to be used by the landowner for his dwelling.  An added benefit I suppose for a gas company using your property.  Other members might have a better insight into this past practice.

This free gas provision is not applicable to shale (Marcellus or Utica) gas wells though as this gas has a higher BTU value and is flowing at great pressures.  Since I don`t have a shale gas lease with anyone yet, I`m not certain if they have provisions to compensate for "no free gas".

Free gas has been part of some past lease offers, but considering the conditions mentioned by farmgas, I doubt it would really be totaly free.  I do not know of anyone who has actually done it.  I always felt that it was a "feel good" kind of offer to in lue of more profitable, offers that could have been made to a landowner in a given lease.

thank you, farmgas and Brian. I appreciate it!

Was llooking to purchase property in Western NY within the past year .. Lots of land with 'free gas' from an old well .. Upon deeper investigation it became clear that the responsibility of well maintenance and plugging probably was a greater expense than using gas from the local utility ... PS . no deal was made  

I`m thinking a discussion of free gas is a tale of two different gas producing times.  The former conventional vs the current unconventional well times are different for landowners.  My impression of the old days of drilling shallow wells when free gas was a part of most leases (at least from my experience) is over.  Sometime during the past 10 years or so conventional wells stopped being drilled, and unconventional wells became the focus.  I believe free gas provisions also stopped.  My original gas lease was with Dominion in the late 1960`s and free gas was a provision of the lease.  The free gas provision remained in the lease through several lease ownership transfers to the present ownership by Diversified.  I`m thinking that many shallow wells might have been drilled by small gas companies of low financial resources who did not offer free gas in their leases.  I think the well maintenance obligation that Ralph mentions is also reflective of those small gas companies.  My view is that across the board there are many stories of good leases vs. bad leases.  Historically, there are many small "ma & pa" sized gas companies who were drilling wells who satisfied landowners need for money to pay the property taxes.  At least this reflects my experience & understanding of the industry 30-50 years ago.  New gas lease holders should not be concerned about free gas from shale wells. 

Good insight Farmgas , As a full time Energy Investor , its great to learn something everyday . 

Freeport LNG reopening ,, MArch weather prediction for US = Cold .. Gas is rebounding [ slightly] . Next years curve well above todays spot price 

LNG seems to be the driver for greater production growth here in USA.  It`s weather conditions around the world requiring more natural gas for heating or cooling that might be our future for more drilling in the Appalachia Basin.  How much more growth is reasonable here in WV, PA or Ohio?  We can`t consume all the gas produced here locally.  How many more pipelines are needed to takeaway this gas to LNG facilities?  What is reasonable for more gas transmission to New England?  Having an abundance of natural gas doesn`t seem to be keeping electricity prices low; they continue to rise. Are there factors other then fuel availability to keep costs low?   Is it just a question of what fuel used will cause the price of electricity to be the lowest?  Two more coal-fired power generation plants being torn down in Western PA.  Member interest in this blog site are varied from landowners to industry investors. I suspect even gas industry associated folks might follow it too. I`m a landowner still waiting for that royalty golden egg. What a journey it has been for the past 15 years tracking everyone`s movement, and connecting the dots to that golden egg.


© 2023   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service