Advice: can we be cut out of production area?
We are about to sign a lawyer-approved lease for our 20 acres with EQT, but recently received more letters/phone calls from Huntley & Huntley. We had been in communication/negotiations with H&H earlier, but they were not as willing to negotiate as EQT has been. Overall, our experience in dealing with EQT has been more pleasant; H&H landmen were very overbearing, wanted to meet in-person all the time, and said some things that can be construed as threats.
The landman with whom we talked from H&H is trying to convince us that they are no longer swapping leases with EQT, but says that H&H will be the company to produce our area. Therefore, if we don't sign with them, we will be cut out of the profits and royalties. They do seem to have most of the leases in our area with a few exceptions.
The landman with whom we were dealing before (also from H&H) said, "If you sign with another company, we will get your lease anyway because we are going to produce here, and you won't be treated as well."
So which is it? Will H&H cut us out if they are the company to produce? Or will they acquire our lease from EQT? Can a gas company just cut out a property owner, or worse, just leach the gas out from underneath?
I hate this obnoxious, hard-sell tactic and based on that alone, I don't want to sign with H&H. However, I don't want to be left out of potential royalties.
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Replies to This Discussion
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Permalink Reply by wyalusing jim on
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although booger stated his case well, I would add that I have neighbors who signed with a company other than the dominant local operator and have not been included in a unit or received royalties for over 3 years while all of their neighbors have been. hundreds of thousands of dollars lost...forever.
if you have a large necessary tract of land for their operations, you might do better to call their bluff.
otoh, if they do not need you, you might very well shoot yourself in the foot. choose wisely grasshopper.
and of course, the best most protective lease ever crafted is worthless if it is never used.
wj
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Permalink Reply by jonathan M. on
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Wj,
Very well said
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Permalink Reply by Megan on
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Although we don't own a lot of acreage, we do have one of the larger plots in our immediate area (20 acres); most of the properties around us are 1-4 acres.
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Permalink Reply by Nancy Mosley on
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What does EQT say about this?
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Permalink Reply by Megan on
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EQT says they have plenty of leases in the area, although they have not produced a map of their holdings as Huntley & Huntley (Range) has.
Who knows, though. The way these people operate, H&H's map could be bogus.
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Permalink Reply by drill0317 on
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wyalusing jim hit the nail on the head, up front is always great but your real money is in the royalties.
Where is the property located?
I believe Huntely is family owned, which makes a big difference in my opinion verse big corporate.
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Permalink Reply by Megan on
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Plum Borough, Allegheny County, PA
The way I understand it, H&H is a brokerage firm for Range. I'm not certain of this, however.
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Permalink Reply by Philip Thackray on
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Megan,
A friend of mine and his family who live on White Cloud Road just signed a nice lease with EQT. EQT is very active in your area. H&H does not drill, they do lease work for Range. Did H&H tell you that you would be signing a Range lease? Who is more active near you Range or EQT.
Phil
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