Comment

Comment by Bob Jenness on April 11, 2013 at 12:51am

All,

A lot of us are still deceiving ourselves that we're dealing in something resembling a free market.  It's one thing for a O&G company to have big bucks and use them as efficiently as possible to lease land in a free market.  It's quite another thing if they attempt to use HBP holdings, in concert with other participants, to control the otherwise free market.  It's even yet another thing if the HBP acreage was acquired by vertical drilling pretense with the prior intent of early acquisition for horizontal drilling.  Regardless of our politics on profit, "we" should not lose sight of the imperative to overcome this market barrier to good lease values.  All individuals and groups need to make this a priority in business strategy and internal and external communication.

Comment by Janice L. Hancharick on April 10, 2013 at 4:05pm

If energy sites are followed, O & G Journal, Penn Energy, MDN, Energy In Depth, and many others, obvious slow-downs can be pin-pointed that affect sound leasing endeavors.  Consider the low NG price which gov't  and industry analysts are now saying will range in the $3.50 - $ 4.50 range.  Who among us wouldn't like to see that happen?  The increasing paperwork demanded of drilling and pipeline companies ... paperwork that must be completed before the first action is taken.  Not saying it's not necessary but it does slow things down.  Also the great effort of  mid-East countries to downplay U. S. shale plays wherever they are,  their efforts to convince our country's public how dangerous drilling is, and their immense funding of anti-drilling groups to politicize the whole process.

Would those wanting to lease prefer everything  move along swiftly?  You bet!  But where is all the infrastructure that needs to be in place before the first drop of oil or wisp of gas reaches a pipeline.  Timing is everything, not only in this business but in life in general.  Burnt food isn't anyone's favorite.  A preemie baby can have lifelong problems.  A missed flight can mean one lives a long life or dies way too young.

Leasing isn't really that much different.  Many connected facets of the whole process have to come together @ precisely the right time through the efforts of many, for companies and lessors to reach a solid deal.  A Group's strength is more than its size, it's the commitment each one has to put in a team effort to make it successful.  If someone in any Group is not doing their part give them encouragement to step away from their comfort zone.  Let them know how it can be accomplished.  THEN growth will spiral! The Group will look even better to interested companies! Go figure what comes next.

Comment by james on April 10, 2013 at 4:31am

Jim, I am not trying to disrespect you or CX, I never said they have done nothing, I know they have got other deals done for alot of other landowners in other counties, I said they have did nothing for me as of today. I have been with them for around 7 months and will give them the remaining months to get me a deal or I will take my chances on my own. I think a year is plenty of time to get a deal done, I think they are going to start losing more landowners then they are gaining if they dont get something done soon, I was told a couple times by reps. that they thought they would have offers in by the first of the year. I have did my part by signing up with CX, now its time for them to do their part and get me and other landowners a lease offer.

Comment by warjr on April 10, 2013 at 2:43am

I believe that the low prices on Natural Gas now has many companies sitting back.  They know what is there.  Once the pipelines are complete and opened we shall see what we shall see.  I live down in S. Central PENNA and things are happening in Baltimore and Philadelphia, the ports.  Could be big stuff as LNG is in demand worldwide.  

Comment by Jim Litwinowicz on April 10, 2013 at 2:31am

Rex; thats the conundrum we all go through. Took me from 2008 to fall of 2011 before I signed a lease. Organized my neighbors in 2008, signed with an agent in 2009 that did crap.Took a lot of time and learned a lot. I feel for all going through it.  Be patient, get the best deal you can, and live with no regrets if someone later gets a better one.

Comment by rex roae on April 10, 2013 at 2:26am

Always forget there's no edit to correct spelling. 

Meant 'predicament'.

Comment by rex roae on April 10, 2013 at 2:22am

Jim I know you're in a catch 22.  Can't get us to sign without numbers.  Can't give numbers without scaring away potential buyers.

But us landowners are in a similar predicimanet.  We don't know which group is going to get us a lease or if we'll get a lease by not signing with either group.

I guarantee you I'm not the only one scratching my head right now wondering which is the right answer.

Comment by Jim Litwinowicz on April 10, 2013 at 2:15am

rex; the problem is that companies always want to keep things very confidential, including the nature of the offers.  They know that knowledge is King. One of the quickest ways to drive off a company is to leak out info.

And even if we put out updates with some numbers attached, many would just say we are inflating figures just to get more people in. I've grown pretty cynical over the years and I would not  have a lot of faith in what I'm told if I were a landowner. Yes that would include Cx if I were a landowner trying to make a decision,,,,,as I was in the fall of 2010. I took a chance on M & P and it worked out well.  As have all other groups except for one.  And that one has yet to play out.

It would be interesting to have an auction for gas rights.  Show say 30,0000 acres and have companies bid.  The problem is that the lease terms are so critical and vary widely with companies that it would be very difficult to do. No way to write one landowner-friendly lease that all will accept in an auction process.

Comment by rex roae on April 10, 2013 at 1:57am

I would be much more inclined to sign with either NWPA or CX if I knew either of them had received a legitimate offer and they were in negotiations.  By each group keeping the rest of us in the dark, it makes it real hard to want to trust or sign with either group. 

I don't want to hear, "trust us, we've done this before" or any other fluff.   What I want to hear and what will incline me to sign is, "this is what we've been offered and this is what we're trying to get".

Comment by Jim Litwinowicz on April 10, 2013 at 1:53am

Ron; our members have been given updates on NAPE. The pipeline issue is not as critical as some people think. Installing infrastructure is part of the cost of doing business. If the geology is right and prices are good they will come. Having a few more pipelines would help.... look at other counties.  Many had few lines but the O & Gs are rapidly putting them in.

This all started in the southern part of the state and has been slowly working north. There is a  lot of exploratory drilling now in both Lawrence and Mercer Counties. Crawford seems the logical next stop....as long as the geology is there.

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