Replies to This Discussion

Permalink Reply by Chuck on August 10, 2016 at 12:35pm

Well definitely haven't said yes. But it's good to see 2 gas companies trying to snag leases up that GP let go within a week of each other. Shows me there is a bit of competition. I am in no hurry to sign. Just want to share what I'm seeing.

Permalink Reply by bo boboski on August 10, 2016 at 12:39pm

Thx for sharing

Permalink Reply by Chuck on August 10, 2016 at 2:04pm

So what would be considered a good deal? Those both appear better than my original GP lease, atleast on the surface.

Permalink Reply by bo boboski on August 10, 2016 at 9:56pm

$5000. per acre. 5 years , 20% with no deductions.from point of sale of all products to non affiliated third party.

Permalink Reply by John on August 11, 2016 at 12:51am

Watch out for the "Market Enhancement Clause".  I have the above contract and first check was reduced by 43% for enhancements to increase value of marketable product.

Permalink Reply by MA on August 17, 2016 at 3:51am

I have read the previous posts and wanted to add my thoughts and my situation.

I have two parcels just South of Winterset in Guernsey County, off of Burson Road totaling close to 20 acres - undeveloped land. My original lease with Gulfport was from June 2011 - June 2016 @ $1875 per acre with 20% royalty. Gulfport has decided not to renew for another 5 years @ $2500 per acre 20%. (I never received a letter from Gulfport - it wasn't until I contacted them that they told me they did not renew the lease.) So my land is not under contract and no one has approach me to lease the rights since 2014.

What is my next step?

Do I sit back and wait for the phone to ring or do I reach out to the major players and see if they will make an offer?  Ex – Eclipse Resources, Ascent Resources and Rex Energy…

Gone are the days of $5K+ per acre for 5 years with 20%, but what is fair market value now.

What would you do?

Permalink Reply by bo boboski on August 17, 2016 at 8:07am

It's like realtors know about real estate; its worth what people are willing to accept as fair payment. If 2000 sq.ft. ranch homes sell for $100,000. then that's what they are worth. If people lease their minerals for $1000. per acre, then that's what their worth. So do all of us a favor, hold out for the fair worth of $5000 per acre and 20% with no deductions! Its what your neighbors got 5 years ago.

Permalink Reply by MA on August 17, 2016 at 8:28am

I understand - it is the basic law of supply and demand. But if there is no demand or little demand at this time then you can either wait or reduce your price. For those who have reduced their price on the leases - what are you getting?

Unfortunately, not everyone can take a wait and see attitude. Given current market conditions$5k per acre - 5 years and 20% maybe just history.

Permalink Reply by Chuck on August 17, 2016 at 9:52am

I don't think gone are the days. We have oil companies knocking on our door now. In your area. Me and some neighbors are holding off for now. Going to say no thanks and let them know what we are looking for. If enough people hold price will go up. I suspect they will get as many as they can on the low ball lease, then go back to those that wanted more after they are locked in. Gas companies competing for our leases is a great thing for us. If you can hold off. I know it's hard for some people that where counting on the GP renewal, but I persoanlly never counted on that money.

Permalink Reply by Brett on September 11, 2016 at 3:33am

Does anyone know how to form a new land owner group. I'm thinking that now might be a good time for those whose leases have been dropped.

Permalink Reply by Prospector on August 18, 2016 at 3:48am

Hello all,

   I have 10 acres on the south side of Quaker City, but it is inside the corporations city limits.  Do you know, has there been any leasing there?  If so, what kind of activity/pricing?  I live out of state and have been trying to find out some info.  Can I even lease my rights if I fall within these limits of the city? 

Thank you.

Permalink Reply by bo boboski on August 18, 2016 at 9:02am

I'm pretty sure that about everyone in Quaker  City got leased back about 4 years ago. Hopefully someone  inside the city limits will respond to your question.

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