Replies to This Discussion

Permalink Reply by Ron Webb on February 18, 2013 at 6:14am

What is Mr Wells geting out of this? Dont he get a percentage?

Permalink Reply by BirdDog on March 20, 2013 at 4:57pm

I'm a member of this attorney's landowner group. I'm in the real estate business and have been doing a ton of research. My particular group does not yet have a lease, but I can say that Wells has done a good job of surrounding himself with knowledgeable people from various areas of the industry. He has not pushed us to jump on the first thing that comes along. And the fact that he charges a percentage (compared to a flat rate like SOME attorneys) is definitely better. That means that the more money he gets me, the more I pay him. Fine with me! Those attorneys that charge a flat $/acre are a joke...what motivation do they have to get you $5,000/acre vs $1,000 when they get paid the same amount, either way? Those are the ones who will push you to sign ANY lease.

An attorney that leads a landowner group would be an idiot to not gather expertise in areas in which they are not trained. Unfortunately, there are plenty of attorneys who are just trying to get their piece of pie and will claim to be experienced or an expert in all areas O&G. Though I do not yet have a lease here in Athens County, I know exactly what Wells is doing and believe that he is doing things right.

On a side note...nobody can predict what will happen in new areas. If you are offered a lease, I don't care what the terms, there is always risk. Risk that you are signing for less than what may be offered tomorrow or risk that this same offer may drop and not be offered at all tomorrow.

Permalink Reply by Samuel J. Orr on April 18, 2013 at 11:09am

Since you have done a ton of research, please share with us any positive information to suggest that DUX is anything other than a shell company! Perhaps John Wells has such information. If so he should share it with you. The more positive information that anyone can provide, the more likely landowners would be likely to lease with DUX through Well's landowner group to which you apparently belong. You make the point that Well's makes a percentage of the bonus money. More acreage leased in favor of DUX would potentially increase dollars in his pocket. So please where is this positive objective data that makes DUX look like anything other than a shell corporation with few if any assets??

Permalink Reply by Samuel J. Orr on February 18, 2013 at 7:52am

Michael: The red flags are out there. Does not Mr. Wells, a presumptively knowledgeable attorney  have some obligation to explain to people why he would even recommend that any landowner sign with DUX, a company that on its face appears to have few assets, and at best appears to be a flipper; as opposed to some of the companies with strong and discoverable financials, such as Chevron, Anandarko, Shell, BP, Antero, and a number of others. If Mr. Wells does not wish to answer, why does DUX not wish to answer? I think it is appropriate to ask Mr. Wells to disclose precisely what his financial relationship is with DUX and how he could advise anyone to sign with such a company given other companies that appear to have strong financials and have the assets necessary to actually drill these expensive unconventional wells. When I say Mr. Wells should answer, he should at least be prepared to answer preferably in writing the pertinent questions raised about DUX, before he advises you or anyone else to sigh with this company. If he or DUX do not wish to answer valid questions on this website, at the very least they should answer to any prospective signee who is about to lease their property to DUX.

Permalink Reply by Samuel J. Orr on February 18, 2013 at 9:08am

I do not suppose to be able to read his mind. Hopefully you will take some of the questions that have been raised seriously. Once you sign the lease you are done. I thought the story in your local newspaper raised questions about how good the deal was. Assuredly if the deal had been with one of the big well-funded O&G companies, we probably would not be having this discussion. If you think the questions that I and others have raised are frivolous then that is your right. Do you believe that DUX can pay you without "flipping" the lease. Will you be happy after signing with DUX, if within the payment period, the market improves and DUX assigns the lease to BP and gets $6000 / acre? I assume that if BP would pay DUX $6000/acre, they would pay you the same amount. Or what if BP justs cherry picks the best acreage and at the end of 120 days, DUX takes a walk on your land? This is just one of many hypothetical situations that could occur that might make you regret signing with DUX.!? Would you think that asking Mr. Wells to provide you with some objective financial information about DUX that would explain how DUX proposes to obtain the funds necessary to pay $4050/acre bonus money on the acreage they have accumulated. I note that one person posted that DUX has 40,000 acres in Washington County. A story in your local paper says the Watertown group has leased 7000 acres to DUX. I am not privy to Mr. Wells' agreement with the Watertown Group, or whether he also has some agreement with DUX? I just do not know, but suggest that you and prospective lessees to DUX get answers to this question and to a number of other questions raised in this forum. What you might do is to spend a few dollars to hire your own attorney who has knowledge of O&G leasing.. Ask him or her to evaluate not only the lease language but also whether it makes sense to sign with DUX given the many red flags raised in this forum. Maybe this makes sense to you? If not, I do not think I can say anything more. I really hope you get a good lease and that things work out!

Permalink Reply by Samuel J. Orr on February 18, 2013 at 11:23am

I wish you well and all other landowners well. Forewarned is forearmed. If enough people read the questions that have been posed and the research that has been done and hopefully consult their own independent  attorney who is knowledgeable in O&G leasing, then perhaps they will get objective and necessary answers to the very important questions posed on this site. At least you are willing to ask questions. It appears that just because an attorney is involved, you are aware that any particular deal may not be a good one. My point is that I would perhaps be satisfied with a slightly smaller bonus / acre if a proposed lease was with Anandarko, Antero, BP, Chevron, Shell, Gulfport for the reasons that I and others have expressed. I also am concerned that many of the prospective lessees to DUX are not as sophisticated as you may be.

Permalink Reply by Samuel J. Orr on February 19, 2013 at 7:49am

To those who have signed leases with DUX or who are considering doing so. please see my post of a few minutes ago to the discussion about DUX under general discussions. I have posed an extremely important question that you need to have answered.

Permalink Reply by Samuel J. Orr on February 19, 2013 at 8:20am

The question posed is this :DO THE LEASES THAT ARE BEING OFFERED TO LANDOWNERS BY DUX CONTAIN A PROVISION PREVENTING THE ASSIGNMENT OF THE LEASE TO ANOTHER O&G COMPANY WITHOUT THE LANDOWNER'S CONSENT? If not please ask Mr. Wells why such a clause is not included. If you want to sign with DUX despite all the red flags, please insist on the inclusion of such a clause. Also before signing a lease with DUX or any O&G company please consult your own INDEPENDENT attorney to review the lease. If he is unfamiliar with O&G law, he can refer you to someone who is knowledgeable! To Michael Householder: Do you disagree with any of this? Since you have a much more positive view of DUX, your comments might be helpful.  

Permalink Reply by Samuel J. Orr on March 18, 2013 at 7:01am

WARNING: TO ALL LANDOWNERS IN WASHINGTON COUNTY, OHIO WHO HAVE SIGNED OR WHO MAY BE CONSIDERING SIGNING AN O&G LEASE WITH DUX PETROLEUM LLC! Please read at least the last 5 or 6 posts to the thread "Help Research Dux Petroleum LLC", which is found under the heading "General Discussions" on this website. If you have time to read the whole thread, even better; but just reading the last 6 to 12 posts to the thread may raise some very important questions to which you may want to have answers before signing with DUX.

Permalink Reply by Samuel J. Orr on May 8, 2013 at 4:21am

Michael: Have you or your friend Drill BABY uncovered anything new about DUX? When are the landowners that signed with DUX supposed to get paid? I would think a lot of them would be due their signing bonuses in the very near future, but you or Drill BABY should have more accurate information?!

Permalink Reply by Jeni Kroll on May 14, 2013 at 5:25am

They did not pay...in fact they asked for another 120 days to see what a Triad well was going to do!!  Nothing like wasting, what seemed like 6 months!!   Pathetic!  I for one am not to happy about the whole situation!  I just want this leasing over with...

Permalink Reply by searcherone on May 14, 2013 at 11:28am

Ah, they didn't pay and still want you to wait another 120 days, is that clause in the lease for an extension?

And if they don't like the Triad results then what?

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