Replies to This Discussion

Permalink Reply by Oil and Gas nightmare on October 7, 2010 at 1:26am

How many offers did yo go through, was east the first and only and you went with them or was there others?...waht happens if say east doesnt have the land around you bt another drilling company does, do they both drill or does it get bought out usually? I ask becasue we are surrounded by pretty much a gas company that has bought up tons of land in our area, so do I really have no choice, if I want to get drilled?

Permalink Reply by Mary j. Green on October 7, 2010 at 5:19am

East is the only company in our area of Lawrence county and so yes, we signed with them. I'm curious...have you been approached by more than one company? I can't imagine that a company would come into an area and attempt to lease a few properties in an area already leased by another. Our neighbor did receive a call from another company trying to lease his place for 3k an acre and 15% royalty...turned out it was a 'cold call' and upon further investigation, we found out the 3K was for a 10 YEAR lease. DON'T FORGET TO ASK THE DURATION OF THE LEASE AND MAKE SURE YOU HAVE A RENEGOTIATION CLAUSE IN AN ADDENDUM!!!!!

Permalink Reply by Oil and Gas nightmare on October 8, 2010 at 12:28am

Could you or any one here give me the laymens way of understanding the renegotiation clause AND the exstention clause? Are they kind of the same thing...IN THE SENSE that they are both talking about the end of the lease period and how you might be forced to stay in or how you can get out? Like see , one person said extentions are good becasue if they are getttng gas from ur neighbor then, they have to keep paying you...so its good but I thought that was bad...And dont worry , I have been reading and have read so much that, you dont have to explain it in a complicated way...but somebody put it to me in a way I could explain it to my 75 year old mother and she would get it?

Permalink Reply by Tom on October 8, 2010 at 6:42am

Extension clauses according to my advisor, allow gas companies to extend the lease if they haven't performed for you and get a well in before the end of the lease. Extensions are bad because they are not motivated to drill and know they have additional time if needed. I would make them sign a new lease, not give them the right to extend the original. In addition it could be time (at the end of your original) to open up your Mom's mineral rights for a higher value on both down and royalties. That's what we anticipate for our Mom. ;-)

Permalink Reply by Oil and Gas nightmare on October 8, 2010 at 10:09am

Is it true that they dont need 640, and by need, the state doesnt require it I know but, do the companies, really put a rig on 40 acres, if thats all they got? or can you pretty much bet if all you lease is 40 acres, unless your in unit, then your not ever going to see royalities. See my brother read that with all the land they are leaseing there is no way everyone is going to get a well put up, so therefore, more than likely most people wont actually see one go up...so does that mean , no royalities or, is it that if your in their land unit, as in they have your land and all the land aorund you but the got it one piece at a time..(so thats wht I mean byt their unit) so anyway, do you get royalities based on tht? Man I know I sound confusing the point is, if I only have 200 acres forexample, and the facts show they are leasing up every sq mile of land they can find, but the reality is only 6 wells will be built that year, odds are its not going to be on your land, so bonuses are really all your are going to get? I AM CONFUSING MYSELF HERE!!!! i think i am trying to say how do you get royalities, if yor on a samll piece of land, and not part of a land group? do you ever grt anything until 10 years from now when they may put something actaully on your land...man my head hurts but Help me understand. I just dont see how if a company has lease 400,000 acres of land how every individual in that 400,000 is going to get a well and royalities, they cant put up that many... so help

Permalink Reply by Tom on October 8, 2010 at 11:38am

I AM CONFUSING MYSELF HERE!!!! Your funny! you and your brother are both correct. What I have learned some people have land that stands on it’s own as long as they can drill horizontal like 4,000 feet or so. Doesn’t matter in every case whom owns where the pad is you can still get royalties and good ones.

If you have a lease written via intelligence they even have to pay for crossing your property. You are welcome to contact me and I will give you more history. I’m in the Fairbanks phone book under Tom Ritchie.

I would say lets meet but my wife and I won’t be down to the lower 48 for a couple weeks. I am not soliciting if you or anyone is worried about that. I truly want to help as a good citizen. You just need help with choices as I did, without someone pressuring you to sign up with them. Make it simple and truthful so you can stop saying “I AM CONFUSING MYSELF HERE!!!!” I understand completely!

The only pressure I want for you, your neighbors, and anyone else is the kind coming from a successful Marcellus well head.

We are not to solicit guess that means mention names as I understand it for the good or for bad. As I said before everyone has a separate scenario and we should try not to compare, only get what’s optimal and right for you. A contract that makes lasting positive relationships for your family, gas company, anyone else involved is what you want....

This site is awesome, it helped me get what our mom and siblings hoped for.

Permalink Reply by Mary j. Green on October 8, 2010 at 10:56pm

Hi, Lynn! I can only draw from our experience but I hope it helps you a bit. (I can relate to your state of confusion...I live in the same state constantly! ;)) Anyhoo....we have 60 acres through which meanders a stocked trout stream. Because of the lay of our land, I really doubt that we will ever have a well which is just fine with me. However, let's say that they drill a well on the property behind us, part of which is an abandoned strip mine. If they were to drill that well, we would become part of that unit and as a result would get royalties from that well.

Let's just say that a well was drilled down the road and as a result, only the northerly 10 acres of our property would be included in a unit, we would only get royalties on that 10 acres. Should another well be drilled to the south of us requiring our remaining 50 acres to be a unit, we would get royalties from that well as well.

Not every parcel leased will have a well. Personally, I'd be more than happy to receive the signing bonus and royalties without the hassle of dealing with the well being drilled, etc.. Unless you have a "well sitting fee clause" included in an addendum as well as a "payment in lieu of gas clause" there's really no benefit. As for the "free" gas offered should a well be drilled on your propery...sounds good however (according to a Penn State agent) the btu's from the marcellus shale wells burns way too hot for any regular household appliance. It would ruin them immediately.

I hope this helps a bit. Keep asking questions and researching...trust me, eventually things will become more clear to you and that light you see at the end of the tunnel will really be light, not just an oncoming train.

Permalink Reply by Oil and Gas nightmare on October 9, 2010 at 12:31am

That is a perfect way to explain it to me thank you... ok so now that I have got that...Does the chance that you will get royalities and a share that will include all of your acres increase, when you get together the typical land uint size lets jsut say they want 640 the norm. If you got together 640, would you then get (using the 200) royalities based on your 200 acrers? And therefore, you should try to get soemthing bigger together/ sorry i am debating my every move... ok thast brings me to laymans explanation of royalities, lets say your at $4000, .20% you got 200 acres... and lets jsut dream, they are using all 200(just to review without a land group) you get .....

20% then where does the acres play into your dollar amount... like 200 x what exactly? the percentage, the daily such and such? what?

Permalink Reply by Dan Laney on August 26, 2011 at 10:01am

Hi Mary - I'd like to talk with you in more detail regarding your post concerning - "well sitting fee clause" included in an addendum as well as a "payment in lieu of gas clause"

Thanks - Dan

Permalink Reply by Oil and Gas nightmare on October 9, 2010 at 1:17am

Wait to solicit is to hay pay me a fee and I'll do such an d such for you...arent we supposed to tell people the names of those they should avoid and the names of those that have been honest and fair, right? HA thats why I put up the whole Holy cow batman discussion. but yes I would love some understanding :) and a discussion :)

Permalink Reply by Tom on October 6, 2010 at 4:48am

STAY AWAY!

Permalink Reply by S Isiminger on November 25, 2010 at 5:54am

We have been notified by an attorney in Greene County that we have mineral rights in 94 acres in Springhill and possibly an additional 59 acres adjoining this as well. There are a lot of cousins in this and about 50 to 60% have recently been leased thru a land company to Chesapeake through this attorney. The lease that our cousins have signed is for a period of 5 years. We have not signed because I do not believe that the attorney that sent us a contingency fee agreement is working in the best interest of us all. He is taking 8% off the bonus and 8% from all royalties. I had an attorney review this and was advised not to touch it, that we would essentially be writing this guy into our lease forever.
I'm partially posting this as a warning for folks to not quickly jump on the band wagon, that not everyone acts in an ethical manner and that there is an attorney in Greene County taking what rightfully belongs to you.
The second part of this is wondering what can we do without an attorney or to find a reputable one locally to represent our interests. Should we attempt to contact the land company (Dale Property in Canonsburg) directly. The rest of us reside in 4 different states and truly feel at a loss. Secondly, we believe that this attorney may not have done his due diligence, he may be conferring with a local relative who was written out of the will (probated in WV) that left these rights to 8 of us, which may muddy this up even further. Since the will was probated in WV would we need an attorney that is licensed both WV and PA? Or do we go directly to Chesapeake???
Any advice for us out of towners is so very appreciated!
Happy Thanksgiving to All!!
Shelli Isiminger

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