Replies to This Discussion

Permalink Reply by Dan on September 28, 2018 at 1:51pm

NG for decades was price volatile.   That kept NG out of the power production and transportation industries.  They can’t plan and function when costs swing like they have in the past.  Coals past appeal was not only price but also stability.  The desire to burn NG now isn’t only the low price but the price has been stable, other wise coal would still be king.  As mineral owners we tend to want the boom bust so we can prosper during the boom but in the long term the continued development will grow with demand but the price and stability is causing the increased demand.  I would like to think the fact that NG is cleaner, fuels the demamd but it is probably 90% because of the money.  The fields will be developed but there is decades of gas in the ground.  The windfall will be for more than one generation but the booms will be smaller and farther apart.  

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Permalink Reply by james on September 28, 2018 at 2:36pm

Your right that NG is plentiful and cheap, as more projects like the cracker plant, more gas power plants, and overseas exports continue to grow, the price and demand will grow. People are still signing leases and getting thousands of dollars per acre signing bonuses, it’s just in select areas, right now competition is nonexistent and that’s why so many leases expired and companies aren’t competing in each other’s area. I don’t know if they got together at one of the gas/oil conferences and decided there was plenty to go around and they wouldn’t bid or compete against each other?? It’s strange how quick most areas died, I think this is a huge opportunity for anyone that missed out on the last boom to jump in and buy some acreage that includes the gas/oil rights and be patient. I have added 5 properties to my portfolio for about 1/3 of what they cost 5 years ago just in the last year or so.

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Permalink Reply by Freestar on October 2, 2018 at 3:32pm

Guys there is no conspiracy. Most operaters simply never make money in the Utica and Marcellus. Only the best operators can make it long term hence why so many outfits have gone bankrupt or selling assets at fire sale prices.

You really need NG to sit above $4 on a long term basis for companies to come in and not only drill out areas but also turn a profit.

You won't have anyone fighting over leases unless your in the sweet spot.

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Permalink Reply by james on October 3, 2018 at 1:58am

I might agree with you other then companies were going crazy leasing everything 6-7 years ago when gas was trading under $2? Back then very little infrastructure, very few big gas projects, and so on. Fast forward today, gas is over $3, several new gas projects being built, and leasing is non existent in most areas?

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Permalink Reply by Albert Russell on October 8, 2018 at 1:48pm

I live in a dry gas area with pads all around us. I think things will pick back up as prices continue to rise

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