Lease & Royalty Payments

Energy Companies | Equinor/Statoil | Harrison County | Lease & Royalty Payments | Monroe County | Ohio | Tyler County | West Virginia | Wetzel County

Statoil Pays $590M for 70K “Wet Gas” Marcellus Acres
December 19, 2012December 19, 2012

In August, MDN told you that Statoil (a Norwegian company) was in the hunt for more U.S. shale acreage (see this MDN story). Statoil previously purchased a 32.5% interest in Chesapeake Energy’s Marcellus Shale acreage in 2008, securing 600,000 net acres for the company (but not as the “operator” for that acreage). They’ve been in the hunt for more, specifically to become an operator, and today they announced they’ve done a deal for an additional 70,000 Marcellus Shale acres—in the wet gas area of the play.

Statoil officially closed on the deal yesterday with Grenadier Energy Partners LLC, Protege Energy II LLC and PetroEdge Resources II LLC, paying $590 million for 70,000 acres in both West Virginia and eastern Ohio. The purchase price works out to be $8,429 per acre.

Here’s the Statoil press release announcing the deal, along with a slide presentation and map of the newly acquired acreage:

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Energy Companies | Gulfport Energy | Lease & Royalty Payments | Ohio | Rhino Resource Partners | Statewide OH

Gulfport Adds Another 30K Utica Net Acres, Pays $10K/Acre
December 18, 2012December 18, 2012

Gulfport Energy announced yesterday they have purchased another 30,000 Utica Shale acres in eastern Ohio for $300 million—or $10,000 per acre. That brings Gulfport’s grand total to 137,000 gross Utica Shale acres (99,000 net acres). Gulfport bought the acreage from its Utica Shale joint venture partner Wexford Capital. Perhaps a better way of phrasing it: Gulfport increased its ownership interest in acreage in which they’ve already invested.

Gulfport and Wexford, along with Rhino Resources, have previously invested in both two and three-way Utica Shale jv’s together (see this MDN story). So far, Gulfport has drilled the top producing wells in Ohio (see this MDN story for the secret to their success).

Read More “Gulfport Adds Another 30K Utica Net Acres, Pays $10K/Acre”
Energy Companies | EV Energy Partners | Lease & Royalty Payments | Utica Shale

EV Energy Partners About to Shed Utica Acreage
December 18, 2012December 18, 2012

Landowners in the Utica Shale who signed with EV Energy Partners, take note: Your lease may soon be reassigned.

An article on the Seeking Alpha website takes a close look at EV Energy Partners (EVEP) and their large Utica Shale investments. EVEP is structured as a “master limited partnership” or MLP. The focus for an MLP is distributing (via quarterly payments called distributions) most of the profit made by the company to its partners/shareholders. Because of its MLP structure, long-term development of “speculative” plays like the Utica is not in line with the company’s mission, so EVEP is looking to shed most of it’s Utica Shale leases—and they’re doing it soon…

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Allegheny County | CONSOL Energy | Energy Companies | EQT Corp | Lease & Royalty Payments | Pennsylvania

Pittsburgh Airport Leases Land to CONSOL
December 17, 2012July 3, 2018

We have to wonder, was the fix in at the Pittsburgh Airport? MDN told you two weeks ago about the opening for two bids to drill on and under property owned by the Allgheny County Airport Authority (see this MDN story). EQT offered more than twice the per-acre signing bonus of CONSOL Energy. EQT’s bid to drill on 9,263 acres was $44 million!

On Friday, the Airport Authority announced that after two weeks of “very, very careful review” it has accepted CONSOL’s bid of $20.8 million as the representing the “best value.” Huh?

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Carroll County | Columbiana County | Industrywide Issues | Lease & Royalty Payments | Litigation | Ohio

Judge Tells Ohio Landowners They Can’t Break Lease
December 14, 2012December 14, 2012

A lawsuit filed by 95 landowners in Carroll and Columbiana counties (Ohio) has been decided in favor of Chesapeake Energy and against the landowners. Last month, Judge Richard Markus (Common Pleas Court) issued his decision that the landowners in the case could not break their lease if they received a better offer—something they thought they could do according to a provision in the lease.

Here’s the details of the case and the decision:

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Allegheny County | CONSOL Energy | Energy Companies | EQT Corp | Lease & Royalty Payments | Pennsylvania

Pittsburgh Airport Offered $44M Shale Drilling Lease Offer
December 6, 2012December 6, 2012

The Pittsburgh International Airport is about to get a huge cash infusion from the shale drilling industry—and it’s not from more passengers passing through the terminal (although that’s happening too). The airport previously floated a request for bids to allow drilling on and under its 9,263 acres. Wednesday morning they opened bids from two drillers: CONSOL Energy and EQT. One bid offered twice the lease payment per acre of the other bid.

Here’s the bid details (and a Marcellus and Utica Shale Databook lease offer map to provide context):

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Economic Impact | Energy Services | Enterprise Products Partners | Fairfield County | Industrywide Issues | Lease & Royalty Payments | Ohio | Pipelines

ATEX Express Ethane Pipeline Will Pay OH Airport $450K
December 5, 2012December 5, 2012

The Appalachia-to-Texas (ATEX) Express Pipeline, a 1,230 mile ethane pipeline which will run from the Marcellus and Utica region to the Gulf Coast is about to ink a deal with Fairfield County, OH Airport to allow the pipeline to run under airport property. If the deal is signed, as expected in the near future, the airport will receive $450,000 to allow the pipeline under its property.

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Energy Companies | Halcon Resources | Lease & Royalty Payments | Mahoning County | Ohio | Trumbull County | Utica Shale

Halcon Resources Responds to Lordstown, OH Landowners Group
November 30, 2012November 30, 2012

A few weeks ago MDN told you about a new landowners group in Lordstown, Ohio, formed in response to requests from Halcon Resources who is asking landowners in the area to sign modifications to existing 20-50 year-old leases on their property to allow for Utica Shale drilling (see this MDN story). At the time the new Lordstown Regional Landowners Group represented 5,000 of the 31,000 acres in Trumbull and Mahoning counties (Ohio) Halcon had recently purchased the rights to.

Apparently the movement has picked up steam and Halcon issued a press statement yesterday saying they want to cooperate with landowners to make them money on royalties, but stopped short of saying they would renegotiate leases, which is the aim of the landowners group.

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Columbia Pipeline Group | Columbiana County | Energy Companies | Energy Services | Hilcorp Energy | Lease & Royalty Payments | NiSource | Ohio

Some Brinker Field (OH) Leases Revised, Others in Lawsuit
November 23, 2012November 23, 2012

Hilcorp Energy was hired by Columbia Gas’ parent company NiSouce to drill Utica Shale wells in the Brinker Storage Field, a 35,000 acre area in Columbiana County, Ohio that Columbia has used to store natural gas going back more than 50 years. The original leases with landowners in the Brinker, leases passed down to new landowners over the decades, mean that landowners get zippo from any drilling—no lease payments and no royalties (see this MDN story for background).

Since the MDN story that first appeared in September, about 100 landowners have signed on to a lawsuit against Columbia and Hilcorp over the lease issue. But also since September, Columbia and Hilcorp have cut new leases with landowners not party to the lawsuit. We get the details of the lease terms from a story that talks about Hilcorp setting up a new office in Columbiana to work on land deals:

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Carroll County | Chesapeake Energy | Columbiana County | Economic Impact | Energy Companies | Harrison County | Industrywide Issues | Lease & Royalty Payments | Ohio | Statewide OH | Utica Shale

Chesapeake Says 3 OH Counties are “Core of the Core” in Utica
November 21, 2012November 21, 2012

On the third quarter earnings call with analysts earlier this month, Chesapeake Energy officials were asked about the Utica Shale and their thoughts, now more than a year in, of how the Utica stacks up against the Eagle Ford, and how Chesapeake’s “core of the core” strategy is working in the Utica. Chesapeake CEO Aubrey McClendon answered the question this way, identifying the three counties in Ohio that are “the core of the core” for the company:

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Broome County | Chesapeake Energy | Energy Companies | Industrywide Issues | Inflection Energy | Lease & Royalty Payments | Litigation | New York | Statewide NY | Tioga County (NY)

Judge Rules Against Chesapeake, Inflection in NY Lease Case
November 19, 2012November 19, 2012

An important court case has ruled in favor of landowners against energy companies in New York State. Last Thursday, U.S. District Court Judge David Hurd ruled against Chesapeake Energy and Inflection Energy (and in favor of landowners) in a case where the companies had tried to extend leases beyond the original term by invoking “force majeure,” a legal phrase that means the terms of the lease could not be carried out due to extenuating circumstances.

Chesapeake and Inflection had argued that New York State’s moratorium on hydraulic fracturing of shale meant they could not drill on New York land for which they hold leases. But as with many things legal, the story is not so simple…

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Chesapeake Energy | Energy Companies | EnerVest | Gulfport Energy | Lease & Royalty Payments | Meetings | Utica Shale

EnerVest CEO Contradicts McClendon: Utica Oil Will be Big
November 15, 2012November 15, 2012

At the Developing Unconventional Gas (DUG) East Conference in Pittsburgh yesterday, EnerVest CEO John Walker contradicted the view of Chesapeake CEO Aubrey McClendon. McClendon said the Ohio Utica Shale will not produce much oil—at least for Chesapeake (see this MDN story). Walker said he believes the Utica will produce a lot of oil—that is, once they figure out the “right completion method.”

Gulfport’s CEO Jim Palm also spoke glowingly about the Utica at the conference. Gulfport, you may recall, has the highest producing Utica well so far (see this MDN story). The conference is organized by Hart Energy, who provided information stating lease payments in the Ohio Utica Shale have reached as high as $8,000 per acre.

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Chesapeake Energy | Energy Companies | Lease & Royalty Payments | Mahoning County | Ohio | Statewide OH

Lawyer Cautions ALOV Landowners on Revising Signed Leases
November 13, 2012November 13, 2012

At a meeting of the uber-large Associated Landowners of the Valley (ALOV) landowner group last night in Youngstown, Ohio, lawyer Alan Wenger warned the 500 landowners in the audience that landmen are knocking on doors once again, this time asking landowners already signed to modify their leases.

Wenger told landowners what energy companies like Chesapeake are asking for, and what landowners need to consider before signing:

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Columbiana County | Lease & Royalty Payments | Ohio

Latest Bonus/Royalty Numbers Mentioned in Columbiana County
October 15, 2012October 15, 2012

Leetonia Shale LLC is a for-profit company hoping to band residents together into a coalition in the Leetonia and Washingtonville, Ohio area to collectively lease their land to a drilling company. Terry May, president of Leetonia Shale, estimates there’s about 1,400 acres of smaller parcels left in the area that are currently not leased for drilling.

May held a meeting over the weekend at Leetonia High School to update area residents on progress and to attract more people to the coalition. Among the people attending was Franklin Square resident Don Shepard, who had this to say about the latest numbers being mentioned by May for signing bonuses and royalties in that part of Columbiana County:

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Lease & Royalty Payments | Ohio | Pennsylvania | Statewide OH | Statewide PA | Statewide WV | West Virginia

Lease Bonus Payments for Marcellus & Utica Reach New Highs
October 12, 2012October 12, 2012

Because the sale price of domestically produced oil and natural gas has gone down over the past year, royalties for landowners have gone down as well. However, the bonus payments landowners receive when signing a new lease agreement have gone up—way up in the Marcellus and Utica Shale.

A newly released survey (embedded below) from Farmers National Co., a real estate management company for property owners, shows a dramatic increase for bonus deals in West Virginia (up 1.75 times), in Pennsylvania (more than doubling, up 2.3 times), but most dramatically, in Ohio (up nearly 13 times from a year ago). The largest reported lease signing bonus in Ohio for 3Q12 was a whopping $8,200 per acre.

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Bradford County | Economic Impact | Hydraulic Fracturing | Industrywide Issues | Lease & Royalty Payments | New York | Pennsylvania | Statewide NY

Bradford County, PA Landowners – $160M in Royalties (So Far)
September 25, 2012September 25, 2012

Listen up New York State: Bradford County, which borders Tioga and Chemung counties in New York, has generated $160 million in natural gas royalty payments to landowners—so far. There’s much more to come.

Here’s the low-down on drilling in Bradford County:

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