Replies to This Discussion

Permalink Reply by Joseph redding on April 10, 2010 at 1:51pm

I have a friend who just got a letter from them , It not only takes your lease rights but your royalitys also. You are stuck with the money they give you and that is it....

Permalink Reply by NANCY A THOMAS on April 12, 2010 at 4:16pm

we rec'd a letter from them also. we live in chatham township, tioga co, pa

Permalink Reply by N Bohl on April 13, 2010 at 12:17am

Tioga County - Charleston Township My family has received the same letter / offer also - twice actually. Once a couple of years ago for 1,200 an acre? and now again for the above amount. It would be for the sale of all rights. The letters were kept with the others for future reference, otherwise it would be trash worthy. I imagine that this will happen more often as time goes by. I would be curious to see what if anything folks are planning for the future when it comes to their royalties. Does anyone know of any threads that address that? LLC's and FLP's and the like?

Permalink Reply by Lynn Wigglesworth on April 13, 2010 at 12:50am

Are many people in Tioga Co. getting royalties? None of the wells in my area (Delmar/Shippen) are actually sending any gas anywhere (no pipeline). I can't find anyone who wants to lease my 42 acres. Even East stopped coming around with their pathetic offer. What to do with my royalties is a problem I'd love to have. Sorry; I'm in a grumpy mood about gas wells this morning...the fracing water trucks are rolling by my house starting at 7am.

Permalink Reply by N Bohl on April 13, 2010 at 1:26am

I can understand being grumpy, unknowns make me grumpy at times as well, let alone trucks rumbling in the AM. Personally, I think one way or another in time if you have acres in the county you will be able to lease. I know each property has it's own issues, if that's the right word. I think companies like McCosar are counting on either people feeling discouraged or having tight financial issues, or not understanding exactly what they are doing. I think overall the actual drilling companies are really, really busy. Those trucks are going to areas where the clock is seriously ticking on existing leases. I also think what you are seeing with the trucks is the true beginning of what will be completely common place for years and years to come. If the economy had not collapsed we would have seen this last year. You may have no offers for a year or two and then suddenly you will get multiple calls a week because someone has made a decision about where they want to work. If you have something like 40 acres and all of the land around you is leased AND there is time left on those leases that company has the luxury of waiting. I don't think it's a negotiating strategy it's just that they don't have to think about that 40 acres until later. But when the time comes it will be relevant and maybe quite suddenly. You have probably done this but you should do what you can to find out what the leasing situation is on all of your bordering land. That will help paint a picture of your situation. My curiosity about royalties has more to do with the fact that I think legally the oil and gas rights have no value until 1. Acres are in a unit and B. the unit is producing. That could change in a matter of months or a year and once that is established I just wonder if one would look back and wish they had done something differently. It's tough because once some of these decisions are made, signing a lease etc., it very well may have repercussions for decades. How often does one have to consider such things in a lifetime? Definitely a bit of a stresser.

Permalink Reply by Wm. Robert Blackwell on April 13, 2010 at 3:39am

N Bohl you are 100% right... The gas companies are doing what they need to first on the lands that are going out of lease the soonest. Most will be September of this year, and January of 2011... Work will be started, and that will buy the gas companies one more year on the lease for free under the continuing operation lease clauses. Then every year after that the gas companies will pay $5/acre to hold your units land until they either produce or decide to let the lease expire.

Permalink Reply by N Bohl on April 13, 2010 at 5:07am

This is just conjecture on my part but I don't think these companies want to sit on these necessarily. A company like East is going to develop hard and once their wells have tangible evidence of production they will continue their growth with that ongoing capital and/or be bought. East is privately owned so it's not like they can just be bought out, that will be up to the owner or owners/major investors. For the next two years - and as you said Wm. really this year especially- they will focus on creating units, making the minimum amount of wells and moving quickly - mostly because they have to. The pipelines will follow as they do this. They will concentrate on the areas where leases are coming up coupled with what areas show the geology will yield the most. All of these companies want to be generating money because they A. Need it to further production as quickly as possible B. Want to demonstrate that this is a profitable play C. They are facing future legal unknowns including tax changes which as they stand right now in PA are in the industries favor and the sizing of units possibly changing- what else? I think the reason Tioga County has been such a focus and will remain so is because there is a major pipeline running through it and it is also one of the most promising Counties in PA as far as it's geology. I write this because I think people are nervous about the multitude of unknowns, I am. In some ways land owners are forced to speculate and it does not feel reasonable. It's like putting the pieces of a puzzle together but you don't have all of the pieces and are not entirely sure what the picture is of to begin with. So when letters arrive from far flung companies like McCosar it is just part of how these things develop and it points directly to the fact that it is developing. If and when people receive royalties they will still get these letters and the amounts offered will probably be higher - just like the history of the leasing in Tioga County these past ten years. Most people do not feel they have the luxury of looking ahead decades but these leases and agreements may very well be relevant that long. In three years the topics on this site will be totally different.

Permalink Reply by Lynn Wigglesworth on April 13, 2010 at 7:06am

Well said, N Bohl and Wm. It's frustrating that other parts of even Tioga Co. are getting better lease deals...the eastern part, Westfield, Middlebury...yet Delmar/Shippen has only East and their $1500/15%.

Fortunately I've come into a little money and can afford to wait. But 42 acres doesn't give me enough land to thumb my nose at East if they ever decide to 'drill around' me. I could lose out, at least until unleased land becomes scarce enough that someone would be interested in 42 acres...barely enough for a vertical well.

Permalink Reply by Joseph redding on April 13, 2010 at 7:15am

Don't feel bad Lynn I'm in Chattham Township and have 30 acers sourouned by East and have the same offer. SICK....

Permalink Reply by NANCY A THOMAS on April 13, 2010 at 1:07pm

i also live in chatham township. $60 acre x 5 yrs. leased til 2-2012.

Permalink Reply by N Bohl on April 19, 2010 at 1:42am

Lynn, at some point we should talk and I will let you know what we did. It may not be all that different than the situation you are in or will be in.

Permalink Reply by N Bohl on April 19, 2010 at 3:30pm

Just to clarify, I was referring to leasing with that last reply to Lynn. Not selling your rights. As far as I am concerned selling your rights seems like a very bad idea.

• ‹ Previous
• 1
• 2
• Next ›
• Page