Oil Gas Wells

Paul

Here's the latest picture of the local well..
Picture was taken from a nearby hill about 250' above the location.

The big companies are responsible and honest. I have neighbors who have had wells drilled on their properties and nothing but good has come of it. The responsible companies don't leave the land in a mess and they state that right up front in the contract.

You can't compare PA bonuses to NY bonuses as the operating rules are different in both states. In PA, you might lease your property and they drill there and you get all the royalties even though the gas field might extend underneath other property owners farther away.

NYS requires the gas companies to lease land in 640 acre "units" and then get DEC approval before drilling. All landowners in the "unit" will share in the roaylties based on the number of acres each landowner has in the "unit."

Yes, you can negotiate but only up to a point. Bonus payments are most negotiable whereas royalties are pretty much standard in the industry and are less likely to be negotiable. Those, like "old" below who says he wants 10%-25% royalties are living in a dream world. 12-1/2% is the usual royalty with some companies maybe going as high as 13-1/2%.

In our area, bonus payments began last summer at $75.00/ acre, then went to $125.00, $200.00, jumped to $875.00 and most recently levelled off at $1000.00/acre. Many people are taking the $1000.00/ acre at 12-1/2%. Some are holding out for more and might get more. The common feeling among those taking the $1000.00/acre at 12-1/2% is that if they hold out and the company drills some wells in the area that are duds, then the value of unleased land drops considerably. These leases are for Marcellus Shale exploration.

This is a summary of what I've learned since last August.

Yes I work at Schweizer..

MAY GOD BLESS THE USA

Agree with RayP and others..Those leases are negotiable, not set in stone.
He'll fuss and say he's got to talk to his Boss, but remember they HAVE to have you in thier lease area or they can't drill.

1. No longer than 3 years at a time.
2. No less than $100 per acre.
3. Don't remember exactly what our % is without looking it up but 12-1/2% is about right I think. Highest I ever heard of was 17%, long time ago.

I'm in the southern tier NY..Corning. Lots of drilling going on here. May of the companies were ripping people off so bad the State stepped in and created a whole bunch of new laws and rules for them to follow. It goes something like this...they MUST have an area of about 640 acres under lease where they want to drill, and that includes everybody.. even the little guy with only 1/4 acre, if you and the neibors get together, you can make a lot of money depending on just how bad they want to drill. We've been under lease for about 8 years now, 2-3 years at a time, each renewal the price goes up cause we know that they know the gas is here. They've done sismic testing here 3 times, first 2 times with the thumper trucks on the road, 3rd time with dynamite holes drilled all over the place. Each time one of the recorder boxes was right here in the yard and we talked to the engineer that collected the data. He asked us about any heavy equipment in the area, we showed him our TD-9 we'd been using to log the hill. He laffed and said that explained it! Seems thier recorders were picking up some funny sounds they couldn't explain..
They are now drilling just down the road from us.
The guys on the rig say this one is a shure thing from the data they've seen. They drill down then horizontally thru the area where the gas is. Going down 13,000 feet then right up the road past our house.

• Hobby farm

Domestic Oil producers in the 1950's call them dry holes if not high producers.
1970's & 1980's the would fire up pump for 1 or 2 days a year to hold lease. Yet you have to farm around road, pump & tank battery. If you have livestock, they always seam to now how to open gate but not close gate. but you can't deny ingress or regress to their pipline, gagues ect.

Just me 2 cents.

P.