Eclipse now paying $1500/acre and 15% royalty to cure older Oxford leases

Confirmed by three landowners in NE Noble County, Ohio.  Up til now, the best offer was $500/acre, a more "modern" lease with ~no deductions and 12.5%.   Cleaning up for the IPO?   Success by Antero in the area have them licking their chops to get a rig placed?  Antero putting the pressure on so they can assemble some JV units?

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Permalink Reply by Philip Brutz on May 23, 2014 at 2:22pm

Oxford did not lease much over the Century coal mine.  Here is a Google Earth Map overlay of the mine.

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Permalink Reply by Busy Bee on May 23, 2014 at 11:58pm
Phillip how does this map from Rice Energy look in Comparison ? Could you overlay this map also? Thanks
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Permalink Reply by Philip Brutz on May 24, 2014 at 10:02am
Busy Bee, I will look at it tomorrow. I don't have access to a computer right now.
Permalink Reply by Philip Brutz on May 27, 2014 at 4:53am

Busy Bee, here is the Google Earth map overlay of the Rice Energy acreage.  You can adjust the transparency of the overlay by right clicking on the file "Rice Acreage" and moving the slider right or left.

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Permalink Reply by Philip Brutz on May 27, 2014 at 5:29am

Here is a Google Earth map layer made from a slide in the May Gulfport investors presentation.

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Permalink Reply by Busy Bee on May 27, 2014 at 10:58am
Nice work thanks Phillip .
015334grltd9mPermalink Reply by 015334grltd9m on May 24, 2014 at 12:23am

Hiker,

How are they curing, what is the language in the ammendment?

015334grltd9mPermalink Reply by 015334grltd9m on May 25, 2014 at 12:47am

This most likely will become widespread for all older leases with unit limitations in the entire Utica, but predominately in the northern Utica where I understand most of the HBP's are.

Permalink Reply by The Hiker on May 25, 2014 at 5:51am

I'll see if I can get a copy of the final lease and post....but I remember it had the updated language for fence repair, ditch depths and reclamation, no injection, "gross" lease with market enhancement, etc....lots of the clauses you will see in a "modern" lease.   The major thing "cured' was the unit size expansion from 160 acres to 1280 ac, but I can't swear to the exact figure.

LOTS of HBP in the southern Utica since Beck and Oxford did their Berea, Gordon etc...thing over the years.  Also, there were lots of mom and pop outfits here that did a lot of drilling, and these are still showing production, especially in Noble and Monroe.   Gary Rubel was one of the larger local drillers who transferred ~13000 acres of HBP to Antero to form the base for their holdings in the NW Monroe area (smart acquisition by the way, as evidenced by the success of the Yontz, Gary, and Rubel wells).

Permalink Reply by John B Gustavson on May 28, 2014 at 3:02am

Is there a Pugh Clause in the cured leases? That would be important for the landowner. Otherwise, the operators form their units for geological and engineering reasons with straight lines and frequently cut off part of the lease as "orphan acreage", left outside the unit. Such orphan acreage would be HBP by any horizontal well in the unit, could not be leased to anyone else, and would not receive any royalties. Result: almost worthless way out into the future. My looking at plat maps of the formed units shows examples of 30% orphan acreage left outside the unit.

John Gustavson

Certified Minerals Appraiser

Permalink Reply by Philip Brutz on May 28, 2014 at 3:04am

John, could you post the plat maps?

Permalink Reply by John B Gustavson on May 28, 2014 at 3:47am

Yes, here is an example from the Gulfport Sandra 1-31H filing with the ODNR.

Plat map and enlarged legend of landowners:

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