Replies to This Discussion

Permalink Reply by Shower Bath on August 30, 2011 at 8:53am

Here is an excellent short article regarding the value of NGLS (natural gas liquids). Note that the wet zone play of the Utica is far more valuable than the dry gas zones in PA due to the Ethane, Propane, etc. Make sure that if you sign a lease, that it covers all hydrocarbons, or you could be very disapointed when you get that first royalty check.

http://seekingalpha.com/article/290406-the-role-of-ngls-in-increase...

Randy

Permalink Reply by DKinPA on August 30, 2011 at 3:06pm

Freddy,  Great terms!  To answer your question: 

"Why are so many landowners signing for a pittance and not joining together like this community did to get a decent lease? I keep asking this and wondering why there is not more action? Any ideas?"

 

We are in Butler County PA and have been watching what is going on in your area VERY closely!  We formed the Butler County Landowner Group to try and accomplish what you have listed.

The benefits of a landowner group are overwhelming and I think many have done it (ourselves included)  but it is a LOT of hard work and many hours of not just research but mostly getting people on board, organizing and communicating but it will be worth it in the end as you guys already know.

Permalink Reply by Philip Dobeck on August 30, 2011 at 11:50am

I disagree with this being a "big secret"  -   the local media has covered this shale play here.

 

Article in Published in the  Jeff last night new local website

Ohioutica.org

Permalink Reply by Hunter on August 30, 2011 at 2:40pm

What language should you look for in lease  regarding royalties  and ngl's if it is already signed and done.

Permalink Reply by Shower Bath on August 30, 2011 at 5:27pm

Without typing out all of the verbiage that might be involved, refer to the draft lease or the lease with notes on the ALOV website. 

http://alov.us/

Randy

Permalink Reply by Al Cramblett on September 17, 2011 at 1:46pm

What a difference a year makes! I started the Harrison County site approximately a year ago. After attending a NARO national convention, I stated the goal for my mineral lease was a 25% royalty. Many responses characterized me as being greedy and unrealistic. Actually, I was trying to protect my heirs. I have not signed yet, but I'm getting close to my goal.

Permalink Reply by Freddy H on September 17, 2011 at 3:21pm

Al, I said something similar about a year ago after I did some investigation of the Marcellus and other shale reserves around the country and people either laughed at me, accused me of being anti-drill, or just plain "stupid" (I hope they meant that in a nice way ... hehehe). But I was really none of those, and now the few neighbors around me who did not lease are beginning to push their expectations up, and now $5,000 per acre, and 25% gross is beginning to look appropriate. (By the way, I am involved in the ALOV project and the numbers given in the draft lease on the web site are lower than what is being negotiated right now by the team as things have changed so much and other O&G companies are interested in the Utica shale). No, Al, not "greedy and unrealistic" but rather wise and prudent.

Permalink Reply by Jon Henderson on September 17, 2011 at 6:39pm

Hey Al, I've read alot of your posts and you seem to be very knowledgable on the geology subject. I live in western guernsey county and am now being told that our area is not desired by the O & G companies. Any advice?

Permalink Reply by Al Cramblett on September 17, 2011 at 7:44pm

Sorry Jon I know absolutely nothing about Western Guernsey County geology. My land is in Harrison County, and the folks posting on that county's webpage due an outstanding job of keeping one another informed. Please go to the Harrison County comment page and look at the map which is currently on page 4 posted by Dan on 7 September at 11:29 AM. I suggest you ask Dan what his source was because I'm sure there is a larger map that you could view that shows Guernsey County. One thing that is not commonly shared is that the oil companies like to drill their horizontal leg perpendicular to the shale flow. A great strategy is to get adjoining landowners to work together. As an example, in my area if the landmass is a rectangle and is oriented from the northwest to southeast there is great demand and potential as that orientation is perpendicular to the shale layer. Good luck to you and your adjoining landowners

Permalink Reply by Mickgyver on September 17, 2011 at 9:38pm

if anyone is interested the geology.com website shows a lot of information about all shale plays . Also why are some groups restricting their size when it appears the larger the group area covered the more desirable the area is. I believe since the actual production is limited now in the Utica play ,when the oil starts to flow that is when the acres are going to bring the premiums that Texas is getting . The people heading these landowner groups really deserve credit if they are not charging fees to their neighbors , but they sure deserve to be recognized for the effort they are putting out which truly takes them away from their families.The sad part is that most of us can use the upfront money so it really takes a lot of faith and trust in your fellow members to stay together through all of the temptation out there .because some of the landmen are straight out fibbing about the information they have given out ,scaring people into signing early for fear of totally missing out, keep up your strength  in numbers it will pay you well in the end.

Permalink Reply by RJ Morgan on October 5, 2011 at 10:22pm

Production like Buell, competition among companies, and time will bring it. Think how far it has come. My church was paid $5/acre five years ago, some were being offered $50/acre not that long ago, and the highest I have seen is what Exxon is purported to be paying in Belmont County- $4995/19%. Just 60 days ago, the norm was $3000/16% (Marquette-now Hess-Richland Twp, Belmont County, and I have no regrets). The royalties when they drill is where the enormous money is, and once the bar is raised again from company x, try to negotiate for more. Hess paid Marquette $8800/acre to be bought out.

Permalink Reply by AT on September 17, 2011 at 10:33pm

Jon,  It may have something to do with a fault line that runs through western Guernsey county.

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