Ashtabula County, OH - Oil & Gas Discussion archives


#1

Oil & gas discussion group for those interested in Ashtabula County, OH. Share your experience regarding lease bonus, royalty rates, drilling activity, and oil & gas news.


#2

I have a parcel of land outside of Orwell. I live outside of Salem, OH (right on the Mahoning/Columbiana line) and leased last year with Chesapeake. Has anyone leased land in Ashtabula with Chesapeake yet? I talked to Buckeye Mineral Development (formally ALOV group who signed around 60,000 acres to Chesapeake this year in Mahoning and Columbiana counties) and they informed me that they are taking names to form a Trumbull/Ashtabula County group. I believe they already have 80,000 acres in Trumbull. The gentleman informed me that hopefully they could put the acreage out for bid soon, pending enough acreage. Has anyone joined this group (http://www.alov.us/) in Ashtabula County? I am thinking of joining, but wanted to make sure there are no other groups to consider first. I heard Chesapeake bought some existing leases in Ashtabula County and I know, via the DNR website, they just pulled a permit to drill a well in Ashtabula County. Any info would be appreciated. Thanks.


#3

I have 120 acres in Harpersfield and have left my name and number with ALOV who say they will call me and others interested in forming a group in Ashtabula County in early December. A couple of weeks ago they stated that the interest on behalf of landowners and drillers is developing, but not that high yet.

NELA is writing to us almost every week hoping that we will sign an incomplete lease; one that holds their "promise" to negotiate for the highest signup bonus but not negotiating for anything else. It is a 5 year lease that you cannot back out of. They have some good clauses in their lease as do others, but their lease is not that complete in many ways.

There are a few other firms/groups/organizations starting to reach out to people but not as many as there will be in the next few years.

The best thing for all of us is to stay in touch and share information.


#4

Thanks for the feedback. There has definitely been a progression from south to north by the drilling companies. At least in my area (Columbiana/Mahoning County) all the large groups have already formed and leased. Now the gas companies are buying up all the loose ends to tie everything together. I know people that have small parcels outside of Salem who are receiving offers from Chesapeake @ $5,800 p/acre bonus and 20% GROSS royalties. To be honest, once companies decide to aggressively pursue leasing in Ashtabula County there will not be much time (as in years) for groups to form. My guess is that if a company like Chesapeake decides they want as much land as possible in Ashtabula County they will have the majority of it leased within a year. The acreage aquired will be the result of small groups (i.e. on a street) banding together to form 1,000 - 2,000 acres, individuals going at it alone, and large groups like ALOV forming. Last year I leased per the result of our street banding together. We ended up leasing around 1,500 acres. To be honest, I wish I would have waited a little longer and been part of the 60,000 acre ALOV group. They had a better contract WRT signing bonus, royalties, land protection, etc.....they have a really thorough contract. The problem is when individuals decide to form a small group in their immediate area, or actually pursue a lease on their own they don't have as much bargaining power in terms of money/ land protection and they need to (if they're smart) hire an attorney to review, add to, delete from, and negotiate the lease. In my opinion Buckeye Mineral Development (ALOV) already has a great lease that does not need reviewed by an attorney, and they already have a lot of bargaining power because of the acreage they have. The sooner people realize this, the sooner they are more likely to join a large group like this. And the sooner landowners join, the sooner the group is able to put the acreage out for bid. With bonus and royalty payments continuing to climb I think that if enough acreage is formed in Trumbull/Ashtabula Counties the group could potentially land between $4,000 and $5,000 p/acre on the bonus and 20% gross royalty. This is speculation, but if enough acreage is gathered (100,000 + acres) it will only increase the odds. It sounds like a lot, but I have been amazed time and time again by the figures people are ACTUALLY receiving WRT bonus payments and more importantly the royalty payments. Hopefully people in Ashtabula County will make an informed decision. Spread the word.


#5

Has anyone heard of an Ashtabula County land owners group forming as of yet?


#6

Buckeye Mineral (ALOV) is informally forming a group in Ashtabula County by taking names at this time. I have not talked to them in several weeks, so things may have moved further along since then. Your best bet is to call them, or e-mail them for more information. Their phone is 330-■■■■■■■■ or 330-■■■■■■■■. Their e-mail is ■■■■■■■■■■■■■■■■■■■■■■.


#7

I also have left my contact info with ALOV who indicate their intent to call me in early December. With past experience of similar intents, I will call them back and not wait for their call. Those who more aggressively pursue these matters are better served than those who wait to be called. I similarly have my name in with another group that you can look up at: www.washingtonpalawyer.com. Their lease is a pretty good one and they have held at least one meeting in Jefferson and are working through local attorneys. Let's keep in touch.


#8

The more a research things it appears that NELA is joke........just a bunch of environmentalists who want to tie up land for years so drilling can't take place in my opinion. It is evident by their news and resources section that they are almost anti-drilling. I'm all for safe drilling, but fracking has nothing to do with the few instances where water might have been contaminated as the result of drilling. Fracking has been done safely for 40 or 50 years. I am not about to sign with NELA and let them make demands of the oil companies that make it nearly impossible to drill. I am definitely more in line with someone like Buckeye Mineral who has a more balanced approach.


#9

Brad, Who would you recommend as a leasing agent?


#10

Loreto,

I like the lease that Buckeye Mineral has. It is very clear that the royalties are based on the GROSS revenue that come out of the well. Other companies will tell you that their lease is GROSS, but they refuse to use "Gross" in their terminology. If they don't use gross, they at least need to have a "market enhancement clause" addendum that eliminates the gas company being able to write off production costs before determining the royalty. Buckeye Mineral's lease also limits the pool to no more than 640 acres p/well. The extension of the primary term is only 3 years, instead of the common 5 years. Their lease ensures that the bonus payment is paid within 90 days. And most importantly, they have a proven track record of (at least as ALOV) negotiating the best price WRT royalty and signing bonus. The also have numerous addendums that protect the land, water, etc. The only problem is Buckeye has not officially started a group in Ashtabula. I think they want to resolve their 80,000 acre Trumbull lease before moving into Ashtabula. I e-mailed them today to see if they have developed any official plans yet, other than gathering names. I will let you know when I hear something. The more names they gather the more likely they are to move forward. I did contact Tri-State Energy as well. They are a "middle man" that are working on behalf of the oil companies. Their end game is to re-sell their leases to a large driller. They are offering $3,000 p/acre in Southern Ashtabula and 17% royalty. Their lease appears to be net royalties, has a 5 year extension on the primary term, payment is within 180 days, and their pooling units are 1280 acres. We can do a lot better than that. Just need to be patient and diligent.


#11

Brad, Thanks. Very interesting. There are a lot of brokers out there trying to get an undeserved piece of the pie. Loreto


#12

Consider the new group to be formed in the next several weeks by ALOV (Associated Landowners of the Ohio Valley). They are taking landowner contact info now and they will contact interested landowners soon. ALOV has worked with landowners extensively in southeastern Ohio (started by Bob Rea) and they have published some excellent leases online.

Also consider contacting WashingtonPALawyers.com. This group of attorneys is currently signing agreements (not leases) with interested landowners. Landowners can terminate their agreement at any time without any cost. The agreement allows the attorneys to organize a group of landowners and develop a lease for them to sign. They then market the lease to drillers and either charge the landowner or the driller a fee. These lawyers have also published a very desirable lease online. Look for the F&M#2 group link on their website.


#13

A pubic informational meeting with Robert Rea from Buckeye Mineral will be held at the Pierpont Township Firehall, January 12, 2012 at 7pm.


#14

Cheasapeake announced it will not drill it's exploratory well in the Andover Oh. area until Mid year 2013.


#15

Just catching up on the news regarding the BP Trumbull County leasing of 85,000 acres at $3900 per acre. Sounding good. Anyone hear anything else since last week?


#16

Attended a Wishgard meeting, thinking about signing. Any input is greatly appreciated.


#17

Well, wishgard appears to be a bunch of B.S.-ers. We waited six months for their "due diligence" and a "bonus check" and all we got was a run around, and a request the day after the check was due for an extension. Why, so you can keep trying to shop it around? Go take a flying leap wishgard! They are full of it!!!! No checks are in the mail. Shame on me for listening to their crap.


#18

Has anyone heard when the next Alov meeting will be and where?


#19

can anyone forward or post phone # or address of ashtabula association or possible meeting location in rome area or the whole county actually


#20

No meeting has been announced recently, but you can make contact at: Buckeye Mineral Development, 7600 W. South Range Rd., Suite 206, Salem, OH 4460. Phone: 330.286.3930 or 330.286.3931. Email: ■■■■■■■■■■■■■■■■■■■■■■. They started to accept landowner applications at the last meeting held on August 14 at which they stated they will accept applications from anywhere in the county.