Fracking: Gas and Oil Rights

[Deleted]

I was interested in a cabin with land in a nice remote location, bordering a state forest and it looks to be just right. However, with the proliferation of gas fracking in this area, most new sales do not include gas and oil rights as the rights have been leased to a gas company by the seller. The seller states that no surface activity is permitted by the gas company but I've read and heard about nightmare stories. Would it be a deal breaker for you? Anybody have an opinion or some experiences?

[daswolter]

For me it would be. Especially the way these companies have been destroying peoples wells with fracking and not owning up to it. Save yourself the head aches. they don't have to be on your land to ruin you land. JMO

[nytrapper23]

Don't trust these big companies,even with contacts , they own the government and will do what they please with time and Lots of $$$$$$$.

[Deleted]

In my area I am hearing about one hundred acre farms with nice wildlife habitat being leased for 250 - 500 thousand dollars for Marcellus and Utica and then sold without the gas and oil rights. I'm all for oil independence but Pennsylvania is giving the rights away to big gas/oil companies. I kinda feel like the natural resources are being stripped out and maybe some serious water problems left behind. I don't want to be a part of that.

[nytrapper23]

I don't blame you,we went thru the same thing here with the big wind companies,the only ones that made out big are the big wind companies. Millions in tax breaks etc.

[northwoodstrapper]

Dino ask to look at the lease. They might have leased the land to unitize a pad. Which means they needed a set amount of acreage to put together the drilling pad you might fall into this. I live in N MI and we have thousands of wells drilled here on 40 acre 160 acre and 640 acre pads. We also have between 12000 and 12500 wells that have been frac with absolutely No problems. Being the great lake state we have the most strict operating procedures in the nation and ZERO incidents. The land your looking at could have been leased on a no-developmental lease. A typical frac job consist of around 99.5 water the rest is sand and common chemicals used in lipstick, cooking, aspirin, etc. I have a list of everything that is used in the process, or you can look a the company MSDS sheets. They do remove trees on occasion but when they are done you have a good road in and they recover the location and reseed everything. Here in MI this make for some great coyote sets and the only green stuff around during deer season. Just make sure you read both side of the story.

[Deleted]

northwoodstrapper,

Thanks for the info. That paints a somewhat rosier picture than I had in my head. Here are some more thoughts. The company footprint when they are just setting up and actively drilling is pretty large and relatively noisy. Also the employees are now part of the landscape for as long as the project runs. This might me acceptable for the person who is getting 3,000 an acre to lease the place and stands to reap the benefits of any royalties later. But the poor sap that just wants a quiet piece of the woods. I think he eventually gets screwed without benefit to him.

My impression of the regulatory environment in PA is that the Governor wants the business so there are NO TAXES or access fees and a relaxed atmosphere when it comes to the Commonwealth. Sounds like MI has better controls.

[northwoodstrapper]

Dino I sure understand your worries I have land here in N MI and I don't own the mineral rights but I do own the surface rights. Which really doesn't matter if you don't own the minerals. Here in MI the state owns a lot of mineral right dating back to the depression. They took mineral rights from land owners instead of foreclosing on the farmer for back taxes. As for no taxes the operating company spends tens of thousands of dollars entering governmental drilling and environmental applications, add another additional 4.5m - 8m to drill each well it adds up to a considerable cost per pad. I guess the bottom line is to try to get the mineral right for what your buying this isn't always easy but worth a try.
Good luck with you endeavor.

[rick2]

The thing I don't understand is.The money being paid down south to property owners is a lot more than people are getting here.I use to live in La.And some of the people I talked to made a hauling.I don't see that happing here.Maybe I am missing something or people are getting a raw deal.

[northwoodstrapper]

Leasing amounts very greatly on what they are looking for. Natural gas $4.34mcf or oil $100.bbl the money has shifted to liquids NGL, oil with good gas flow will usually will bring the biggest dollar.