Replies to This Discussion

Permalink Reply by william Allen. Ladd on August 29, 2015 at 12:04am

Mike, do you know if these prices are just for the area the pad takes up or are access roads included too? Some access roads need to be fairly long and others only a few hundred feet.

Bill L.

Permalink Reply by paleface on August 29, 2015 at 2:02am

 15 was the best I could get from Shell.I'm happy with that I want Shell to make money at this so they don't shut this hole thing down.

Permalink Reply by K2 on August 29, 2015 at 8:25am

Wow, sounds like people are just taking the initial offers made by the gas companies.  That is a mistake.  The initial offer is likely to be a "site" agreement.  But you will want to negotiate for an agreement based on the actual acreage used for the pad, access road, temporary work spaces and land used as "borrow pits" (done when dirt is required for the pad).  The gas companies will give an estimate of 10-15 acres.  But the actual acreage used can turn out to be much higher. Some pads and access roads eventually require over 30 acres.   The gas companies will tell you that they will pay per acre based on the value of the land, often just grass gazing land. They may offer $1,000-$2,000 per acre but a pad devalues your entire property and not just the actual acres used.  So, you need to be compensated for the entire impact on your land.  A reasonable per acre price can be in the $4,000-$5,000 range plus timber and crop damages.  You should also make sure you have provisions in the contract for fencing, reclamation procedures and other property safeguards.   If you are uncomfortable in negotiating the surface use agreement yourself, hire an attorney who has experience in this area 

Permalink Reply by william Allen. Ladd on August 29, 2015 at 10:05am

Without asking these questions, The landowner could end up financing a great deal more of the drilling operations and being unaware of doing so.  It has been said many times, "The rich get richer and the poor get poorer!"

What aggravates me is that some folks who have unfair access to inside information use this information to acquire more acreage to enrich themselves even more.  

Bill L.

Permalink Reply by william Allen. Ladd on September 11, 2018 at 3:50am

I must have hit a bit of truth with my previous posting.