To Lease or Not to Lease: Has Anyone NOT signed a lease? I'd like to hear why you didn't

My wife and I are part of a landowners group that is in the process of having their Range Resources contract reviewed by attorneys.  We only have 3.2 acres and have not decided whether we are actually going to sign a lease.  I am curious to hear from people who started to go through the process and then at some point decided against it.  I'd like to hear your reasons.  FYI - I'm not posting this so I can attack people's decisions.  I am genuinely interested in hearing from people who decided not to sign a lease.  

 

Thanks in advance!

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Permalink Reply by craig on November 7, 2011 at 7:54am

Please post a link to the blowout you are talking about. If it is the one in Washington County then you are completely wrong, in fact there wasn't even a fire, and not even at the well pad itself.  If you post a link to a different well problem, I will comment further at that time, because I don't seem able to find a link to any well fire last week. If I am wrong I will admit it. Will you do the same????

 

Post a link to a water treatment plant that is still treating frac water as well, because to my knowledge non are currently taking any, at least in W. Pa.  

 

Permalink Reply by Karen Bagdes-Canning on November 7, 2011 at 4:03pm

Here is a link you all may appreciate.  I know I did.

Below is a link to today’s NYT Op Ed piece by Paul Krugman.  Krugman  states that the cost of fracking, because the costs of the harm it inflicts, is  not cost effective, and if those costs were properly internalized and not in  effect subsidized, would be higher than the cost of solar.  He also states  that, contrary to the claims of the fossil fuel industry and its supporters,  solar costs are decreasing by about 7% annually, but because of the influence of  the fossil fuel industry on our politics and the industry’s ability to control  the public debate, this is large unknown.

Permalink Reply by Barbara on November 7, 2011 at 6:52pm
very interesting viewpoint.....................wow
Permalink Reply by Rock Ranch 42 on November 8, 2011 at 12:53am

" So what you need to know is that nothing you hear from these people is true"

About the only fact in his article. I wonder how he heats his home? I bet he lets the curtains open for the solar gain.

Permalink Reply by craig on November 8, 2011 at 3:00am

All I can say is keep on believing blogs and opinions that either side on this subject puts out. Neither side is being honest with you.

If you believe that solar is now cost effective in our region, then I would expect that you should be running today to buy as much stock in solar energy as you possibly can. Personally, I know how economical solar works in western PA having seen $81,000 spent on a system 1 year ago and knowing what my brothers results are. IF you are close to being a millionaire, then you won't miss the money while your return of investment trickles in the benefits of solar. 

I don't doubt that solar costs are coming down, but their are three reasons why the costs are coming down and two of them weren't covered in that opinion piece. I wish lots of folks would install solar right now, then in about 2 years you would have the true answer about solar in those blogs.

Solar has a way to go before being able to become main stream.

 

Permalink Reply by Jim Litwinowicz on November 8, 2011 at 3:32am

First, note that Jake never posted a link to any current well blowout...because it didn't happen.

And solar is nowhere near competitive with any other source of energy.  It has appeared to be that way because guys like Krugman use the cost after all tax incentives are applied which means that tax payers all across the country are paying for it.

The truth is that solar is about four times higher than gas generated and double nuclear. At a 7% decrease per year, it will take 18 years to become equal...and thats if gas prices don't continue to fall.

And he ignores the tremendous pollution caused by the manufacturing process of solar cells.

Permalink Reply by Barbara on November 7, 2011 at 1:29am
the whole tax/fee issue has only recently been taken up to actually implement; until now this has been rejected completely by the governor.  yes, you are right, 'things' keep changing.
Permalink Reply by Jim Litwinowicz on November 7, 2011 at 2:19am

Barbara;  I am not an attorney or tax expert but the impact fees are paid when a company applies for a permit, not when royalties are paid. If a company tries to deduct these from royalty payments, then the royalty owners should organize and file a lawsuit.

I think that all landowners should organize together as soon as they are notified they are being placed in a unit.  They need to work together to monitor activities and ensure the lease is being followed. That would include having the group have their water wells tested before and after drilling.

Permalink Reply by Barbara on November 7, 2011 at 3:27am

you are so absolutely right.  and today that is the obvious/logical thing to do.  however, in my 'defense', i had just moved here in 2007 and was stunned with the seismic testing request, first of all.  i truly thought this all a big joke.  then the landman came with a lease offer for $750/acre, if i remember right.  THAT was stunning; but i did have enough sense to read the lease and realize for sure i needed legal advice with this.  i had one friend here who was not quite as new as i to the area, and she and i both went to lawyer.  MOST of the other neighbors here...rural, not so very many....just signed the lease, some not even bothering to read it.  so asking for advice was out of the question.  some of these people signed for five dollars/acre, and are now locked in, of course, to that forever since the wells are being drilled as i write this.

so, you are so right.........................i urge ANYONE being offered any lease for land or pipelines or over ground pipelines or containment ponds...............................see a lawyer.......and find one that knows oil and gas law.  don't be fooled by anything fancy about him/her...get credentials. these laws continually change, too, as do leases....one just MUST cover all aspects as well as can possibly be done.  sites like this can prove invaluable to help awareness of what's going on.

Permalink Reply by Jim Litwinowicz on November 7, 2011 at 4:18am

Barbara; its not too late to form a landowner group. There will be many issues that develop during the drilling and afterwards. Forming a group will get all the neighbors educated. Being in a group will allow people to share what they know, the sources they use, and what issues they need to study. And acting together will give them much more power in dealing with the companies should something serious develop. They will keep each other informed about new laws and regs. And they can share costs like lawyer fees, water testing, auditing of books, and more.

 

 

Permalink Reply by Jonathan A Jones on November 7, 2011 at 6:37am
UPDATE:  We are being required by our real estate agency to disclose in the Seller's disclosure that there is potential Marcellus Shale activity in our area.   In addition, they are asking that we include a completed lease agreement with all the information like bonus payment, royalties, setbacks filled out.
Permalink Reply by Jonathan A Jones on November 7, 2011 at 11:28am

UPDATE (I think this is the final one!):  Although we do have to provide a short statement in section 19, sub-section (i) of the MLS Seller's Disclosure statement, we do not have to provide the proposed lease as part of the seller's disclosure.  As a matter of fact, Range Resources forbid us from doing so because providing it could be construed by a potential buyer that the lease would be valid for them.  There was some confusion regarding what our intentions are for the lease we have in front of us.  The mortgage company and underwriters further clarified that as long as there wasn't an existing gas lease on the property they had no issue.  

After all of this, I think we are going to just let the O&G rights convey with the property (deed simple).   I did know that to use them as a negotiating item with a potential buyer would require us to prove title, but what I didn't realize was that if we wanted to withhold them we would also have to prove title (duh!) because you can't keep something you don't own!  

Although we may be missing out on some $$$ in the long run, it's a decision that I can live with and one that allows this whole process of selling our home to be less stressful.  And who knows?  Maybe one of the gas companies will open up an office in Butler County and see that as a plus for our house and property!

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