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 Lilace Guignard on September 28, 2011 at 4:43am

My husband and I moved out of the town of Mansfield, PA last fall to get land to homestead. It was now or never if we wanted unleased land. Shell is here and the main player, and their office is less than a mile from our new home that has 7 acres. Like you, we feel reasonably financially stable and are not wowed by get-rich-quick or have-tons of-money-for-the-grandkids pitches. We lived in Reno for years and never played the slots :) I looked into what leasing would mean and called consultants, talked to friends who made all sorts of decisions. I won't go into all the stories, and obviously I had the means to judge the credibility but readers here wouldn't. It'd be hearsay. Our main concern was property values, in terms of leasing. So we also talked to our real estate lawyer. That was eye opening. I strongly suggest that you or anyone considering leasing take the lease to a good real estate attorney,not just an oil & gas attorney. Enough issues were raised (or revealed) concerning how it effects homeowners insurance policies, can affect equity (if the gas company buys your primary mortgage as some have), possible liability for accidents on your property, and retaining better value than leased land, etc. Also, with only 6 acres we aren't looking at a lot of money, not enough to deal with the taxes headaches and going to lawyers constantly over industry documents and lease conditions. Arg! 

Ultimately we decided not to lease. We can't control what goes on around us, and we see the need to develop the resource (but have issues with how it's done, at what speed and density, and believe the natural gas should stay stateside and be used to develop infrastructure for renewable energy resources). The bottom line for us is, no matter how we feel about the resource, we do not trust any huge corporations, and the gas industry has played fast and loose with language for too long. (Yes the env side often spins the science their way too-but that's another issue. A good article is http://www.therepublic.com/view/story/a9b9cf768d0e46b9a572fe413ce0b...)

My husband and I have started a blog simply chronicling our experiences raising kids and learning to homestead in Tioga County. We sell nothing and there are no ads. We are just documenting what life is like here, stories of our community, and issues of language surrounding the Marcellus Shale development (we are writers and teachers). It's a stressful, beautiful, wonderful, scary place to live. The blog is called Greetings from Pipeline Road 7. If anyone's interested you can google us or check out wordpress. I found gomarcellusshale when doing research and think this site has the best dialogue among multiple perspectives. Good luck deciding, Jonathan!

Permalink Reply by Jonathan A Jones on September 28, 2011 at 4:58am
WOW!  Your blog is awesome.  I read just a few entries and was disturbed by the one about the seismic testing.  I wish I wouldn't have signed that paper now.
Permalink Reply by Lilace Guignard on September 28, 2011 at 8:52am
With luck and the small size of your property, the grid will miss you completely. Glad you like the blog. I'm late getting the next post done . . .
Permalink Reply by Freddy H on September 30, 2011 at 4:15pm

I too read your blog and found it most inspiring, yet with the same questions we have here in Ohio with all the O&G drilling and leasing going on. I wish you the best in finding that beautiful house on the knoll to raise your children and enjoy the view!!

 

  As for the question of this thread ... no we have not signed the family farm away(a bit over 100 acres) yet and are still watching, waiting and learning. I imagine we may well sign, but the time is not right yet, and we have a CHK horizontal well being drilled within 2 miles of us and 5 vertical only wells into the Utica within 3 miles of us. So much activity, and landmen threats. Life here was more peaceful once ... sigh ...

Permalink Reply by Mickgyver on September 30, 2011 at 4:52pm

Hello Freddy , I was reading the blog and wondered where you are located with all this activity . I am in Belmont County and they have not done much here except the Consol well that was producing 1.5 million cu.ft every 24 hours

 

Permalink Reply by Mickgyver on September 30, 2011 at 4:56pm
Hello Lllace since you have not committed to a company do they hassle you a lot with higher offers trying to see if you have a breaking point or did you just flat tell them leave you alone .
Permalink Reply by Jonathan A Jones on September 28, 2011 at 1:57pm
Joe - I understand that if we don't lease chances are they will be taking our gas anyway.  If we did not sign we would be surrounded by people who have signed. At this point, it's more of an ethical and safety issue for us as a couple.  Sign, don't sign  - For us it's not going to matter because it's coming to our area regardless.  I believe that we, as a country, need to tap into this source of energy.  However, I fear, that at least in PA, we are rushing into something at light speed that we don't truly understand.  Yes - I've said this before and I'll say it again - I believe that the actual technology to do the drilling is safe as you're going to get today.  I caveat that by saying the oversight is sorely behind especially in PA.
Permalink Reply by Mickgyver on September 28, 2011 at 3:28pm

This is really a conundrum when you have strong feelings against the situation . I want to lease because the money will help my family but I am also concerned about all of the unknowns that may come from the deeper part of our earth . As far as a no drill lease , I spoke to a man from Morristown Ohio 2 days ago and he said he did not want them on his property , he said these landmen keep changing prices to neighbors in the same basic area and he does not trust them because if they lie like that and tell neighbors not to tell what they got you don't know what else will be lied about . I thought a no drill lease was that you allowed them to go under you but not down through you and no equipment was allowed on your property .i did not understand what happened to him though , he said he signed a no drill lease and got only $5.00 total. No matter what happens I am sure we won't see much of the affects for quite some time unless you have  enough acres to form an actual drilling unit then there is probably a much higher chance of a quicker drill set up. I don't know how they will begin but I am sure after they sell and transfer the leases to several companies and probably merge with the foreign entity's it will take a long time to develop this many acres. I personally don't think we should allow foreign control but it takes a lot to stop that . I agree that we need to beware of safety issues for our future . Hopefully greed will not cloud the situation overall . And Like Joe said if you are surrounded you could take the money . If it would make you feel like you did not go too far against your principles take some of the money and give it to special wish or any good cause which will warm your heart .

Permalink Reply by Jonathan A Jones on September 28, 2011 at 3:33pm
One of the the things we actually discussed we respect to the money is using it to install a renewable energy source on our property like solar.  Also, interestingly enough, I had a conversation with our homeowners insurance company today (Travelers) and the representative I spoke with said that their company does not allow pipelines or any other permanent structures on a residential property they insure.
Permalink Reply by Barbara on September 28, 2011 at 3:51pm

oh boy................had no idea of the insurance implications.  good grief...........now what?  is this going to be like trying to get flood insurance?  yikes.  no questions YET from my ins company, but they have made all kinds of exclusions related to any kind of water anything effected by gas.  thanks......maybe!!!.....for the head's up. 

anyone else run in to this?

Permalink Reply by Jake Jackson on September 28, 2011 at 4:17pm

This means if you leased your insurance will be canceled.  I can only wish you the best of luck if you have leased, or else see if there is an attorney who will look over the lease to see if you have time to get out of it.   The fact that people are on here telling you that everyone around you will lease and they will take it anyway is a lie.  There is much to this industry that we don't know or trust. Here is what is happening all over where this industry is operating. Search the other stories in the Times on Marcellus Shale and read the truth for yourself.  We must all ban together to stop this insanity. Everyone must say no until these companies stop destroying our land, air and water.....what is happening to land owners is criminal, all over the US.  http://www.nytimes.com/2011/09/27/business/energy-environment/in-no...

 

http://www.marcellus-shale.us/gas_flares.htm

 

Permalink Reply by mike4t on September 29, 2011 at 6:25am

I am going to wholeheartedly disagree with your statements about insurance being cancelled because of a pipeline on your property. I happen to have over 2700ft of gas pipeline on my property- It was there when I bought the property and I never had any problem with insurance, and my rates aren't that high. I also have a shallow gas/oil well VERY close to my house that I have 100% ownership of (including maintenance.

 

On top of that I probably have better well and spring water than probably 90% of the people on this site. I'm sure when they drilled my well 40+ years ago, they went through the water table and sealed the aquifer like they should. The problems that was occuring now with water is from ragtag drillers that wanted to make some fast cash and didn't follow the correct procedures

 

None of my kids have three eyes, none of the local wildlife has two heads.

 

Karen B-C.... BTW   I personally talked with a half dozen businesses and people from different areas around the Connequenessing area this week to see if your claim about people there getting sick is true.... NOBODY has heard of ANYONE getting sick....... I just think they're sick to their stomach because they didn't sign for enough $$$$

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