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Permalink Reply by JK on February 5, 2013 at 5:26pm

I hope you received bonus money at least.

Since you are in the 5th year and your lease states no information for auto-renewal, then you are open for business once again. Could be a blessing since CHK is sending their rigs West of you.

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Permalink Reply by Earl Wilkerson on February 7, 2013 at 1:35pm

Thanks for reply. Actually if I remember correctly, my lease does give Chessapeake the "right" to renew the lease ... by paying me the same per acre lease payment as at the outset. However, unless I hear from them sometime in the next few months, I will be shopping for someone else who may be interested in a fresh lease on my acres. The issue I am concerned about is whether some of the "environmental" folk have succeeded in making it difficult to drill in Allegheny County, although I have no direct information to document this rumor. Would love to hear any well based info from anyone in the know.

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Permalink Reply by Jim Litwinowicz on February 7, 2013 at 1:58pm

Earl, if you want to know who is leasing around you talk to as man people the area and ask. Go to you court house or their website to see who is leased to who. Go to the township building as they are usually on top of these things. Check out Westmoreland Co also since you are "on the edge."

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Permalink Reply by Jason on February 7, 2013 at 3:11pm

Earl - Pittsburgh airport just signed 9,263 acres for $500,000,000 with a $50,000,000 deposit from Consol and 18% royalties. It's on post gazette online.
Expecting total to be $1 billion in next 20 years with infrastructure.
I'd like to think someone wants your acreage...

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Permalink Reply by john on February 8, 2013 at 2:05am

I'm going to guess that Chesapeake will renew with little intensions to drill.  They just renewed acreage in Preston County, WV and I know for a fact that they won't touch it for years.  

On the other hand Chevron is really developing Fayette and Westmoreland so maybe in a few years infrastructure will move your way.  These companies like to keep their inventory of land as full as they can for future loans and investments... which will probably be sunk into a more profitable area.

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Permalink Reply by Jim Litwinowicz on February 8, 2013 at 3:05am

Jason; that works out to $53,500/acre.  I think its off by a decimal point.  And the airport is the west part of the county whereas Earl's parcel is in the east of the county.

John; CHK may or may not utilize the renewal option. Depends on their local plans.  They may make a lower offer than the existing lease at which point Earl would be free to take offers from other companies. He should start looking at his options now by finding out which other companies are in the area and what they are offering. And if he finds a lot of other people not leased or with leases about to expire, try to get them to all work together as a group.  There is power in numbers.

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Permalink Reply by Jason on February 8, 2013 at 3:23am

Jim - the $50 million was the deposit. The other $450 million is an estimated calculation of the royalties estimated over the next 20 years at 18%.

Sorry to be unclear - the story is in today's Post Gazette.

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