Barnett Shale

Burleson groups, Chesapeake reach record $27,200/acre deal

Two big Burleson property owners groups have jointly accepted Chesapeake Energy's leasing offer of $27,200 per acre and a 25.25 percent royalty, organizers say. The central Burleson and south Burleson groups together represent upwards of 2,000 acres, including school district and city property, said Carter Mahaney of Burleson Community of Gas Lease Holdouts, the south side group. The other group is the Central Burleson Holdouts. Also bidding was XTO Energy, which offered $22,000 an acre and a 25.5 percent royalty, Mahaney said.

Mahaney said Chesapeake told the groups it has secured several drill sites capable of reaching much of the city, which is partly in southern Tarrant County and mostly in northern Johnson County, the two most productive counties in the Barnett Shale field. He said the groups will rely in the city's recently modified drilling ordinance to provide major environmental and safety protections. Mahaney said his group will continue to accepting members through May 15, and he hopes lease signing will be completed by the end of June.

-- Jim Fuquay

CATS endorses Titan Resources/Caffey contract

CATS, the southwest Arlington group representing homeowners immediately east of Lake Arlington, said Monday it endorsed a lease with Titan Resources/Caffey Group and will hold informational meetings at 4 p.m. and 6 p.m. Monday at St. Vincent de Paul Catholic Church, 5819 W. Pleasant Ridge Dr. The CATS lease pays a $26,000/acre bonus and 25.5 percent royalty for a 3-year term (and a commitment to drill within 30 months), said organizer Jim MacDowell. He said the extra half-point royalty came from the owner of a planned drill site, near Bowman Springs and Shorewood, who contributed a portion of his override on the lease. Titan is affiliated with Hollis R. Sullivan, MacDowell said. He said the deal was the outcome of discussions with five parties that eventually came down to Titan and Paloma Resources, acting on behalf of Chesapeake Energy.

-- Jim Fuquay

SE Arlington group backs record lease with XTO Energy

A big southeast Arlington neighborhood group said Friday it has endorsed a lease with XTO Energy that will pay the area’s highest signing bonus yet reported, $26,517 an acre, along with a generous royalty of 26.5 percent. Mark Middleton, an organizer of South East Arlington Communities of Texas (SEACTX), said the group on April 1 actively started seeking bids to lease the mineral rights of roughly 6,000 acres covered by about 20 neighborhoods in the group. It reached agreement with Fort Worth-based XTO Thursday afternoon, Middleton said. SEACTX also drew interest from Chesapeake Energy, Devon Energy and Antero Resources Barnett Corp, he said. Chesapeake is the busiest driller in the Barnett Shale, while Devon is the biggest producer but has mostly stayed out of the urban area. Antero sold its Barnett Shale properties to XTO in early 2005, but recently re-entered the play, Middleton said.

Middleton said he understands that among the drillers, only Chesapeake had secured a drill site, located just south of Seguin High School. But property owners committed to sign with XTO virtually surround that site, and he expects the two big competitors to work out a deal to give XTO use of the site.
XTO and Chesapeake representatives could not be reached for comment late Friday.

SEACTX extends mostly south and east of Arlington Municipal Airport. Click here to view the group's map of its boundaries.

-- Jim Fuquay

Devon, Chesapeake execs talk leasing at conference

Top executives at Devon Energy and Chesapeake Energy, two of the biggest players in the Barnett Shale, bemoaned the high cost of getting leases in the Barnett Shale at a New Orleans investment meeting, reports Reuters news service. Chesapeake Chairman Aubrey McClendon, speaking to reporters at the Howard Weil  Energy Conference, called the escalating bonus payments "a discouraging trend," adding that "luckily, the costs of acquiring acreage are generally not a meaningful part of your overall cost equation."

"We are amazed at the royalty rates and bonuses that some people are paying to get into the area," Devon Chairman Larry Nichols told Reuters. Devon got into the play with its 2001 acquisition of Mitchell Energy, the Barnett Shale's pioneer, and expanded that in 2006 with its purchase of Chief Oil and Gas. It has stayed mostly in rural areas, unlike Chesapeake, which has jumped headlong into the most densely populated portions of the play.

-- Jim Fuquay

Signing meetings for Little Green Ark neighborhoods

Lease signing meetings are being held tonight ( Monday, 3/24 ) and next Monday (3/31 ) at Lake Arlington Baptist Church for residents of portions of the Little Green Ark neighborhoods of southwest Arlington. Hours are from 5:30 p.m. to 8 p.m.

The specific neighborhoods signing at these meetings include:

• Alexander Place -  All property owners on Sausalito Drive
• Greenwood Hill Addition - Property owners from 4606 Lester Dr. thru 4717 Lester Dr.;  all property owners of Ironwood Ct. and Basswood Ct.
• Oak Valley Estates -  All property owners of Oak Valley Dr.; property owners from 2800 Bonneville Dr. thru 4904 Bonneville Dr.
• Quail Hollow On The Lane Addition - Property owners on all streets
• Whisperton Addition - Property owners on both streets
• Wooded Acres Addition - Property owners on all streets

Neighborhood representatives agreed last week to terms of a standard mineral rights leasing offer for area residents and landowners with Paloma Resources, including a $22,000 per acre signing bonus and 25 percent royalties.

Residents are asked to bring official identification, such as a driver license.  Married couples and multiple owners listed on a deed must attend together.

Lease signing dates for other property owners in the area will be announced soon.

-- Bob Cox

(Photo: WinterFest at Lake Arlington Baptist Church)

$22,000 offer for Little Green Ark (SW Arl) owners

An e-mail going out today to residents in the Little Green Ark area of southwest Arlington says Paloma Resources, working on behalf of Chesapeake Energy, has extended a $22,000 an acre gas lease offer to  property owners.

The offer, according to a neighborhood organizer, will be exte nded to all residents of the newly expanded area which includes residents of the areas bordered by Arkansas on the north, Little Road on the east and Green Oaks on the west south to about Pleasant Ridge.

The same offer is being extended to residents of the Murwick Area Neighborhood Association (MANA), an area east of Little Road and south of Mayfield.

Primary points of the offer are:

• $22,000 per acre signing bonus;
• 25% no-cost royalty;
• 3 year lease, with a 2 year option to extend, at a bonus amount equal to the bonus paid ($22,000/acre) for the initial lease;
• Property owners to be paid by 10-business-day vouchers, to be exchanged for checks after the 10th business day, payment subject to approval of title.

- Bob Cox

(Photo: Diabetes walk-a-thon at Ditto Elementary)

SWAPO, the sequel: SWAPO2 debuts in SW Arlington

Hoping to build on the leasing-signing success of SWAPO (Southwest Arlington Property Owners), a second group in nearby neighborhoods have formed SWAPO2. Click here to see a larger version of the group's boundary map, which encompasses land on both sides of U.S. 287, north to Green Oaks Boulevard and east to Kelly Elliott Road and which is still in development. Organizers, headed by Tom Rodgers and Peggy Ivie, aim for a bonus of at least $15,000 an acre and various environmental and safety protections. They are distributing fliers encouraging property owners in the area to refrain from signing individual leases. Interested property owners are encouraged to sign up for e-mail updates using the form on the group's web site home page. Persons without Internet access can use an information hotline at 817-945-3536.

-- Jim Fuquay

Having a meeting on the Barnett Shale? Publicize it here, on our new Community Calendar!

Fielder Park group backs much-improved lease

Bernetta Glasser of central Arlington's Fielder Park Gas Lease Negotiating Group reports that the organization is supporting an offer from Carrizo Oil and Gas for $15,000 an acre and a 25 percent royalty. She says lease signing started Thursday.

The Fielder Park group's experience is a shining example of how neighborhood cohesion can earn more favorable lease terms for landowners. Carrizo's first offer in July, through its agent Cheaha Land Services, was $1,200 an acre and 23 percent royalty. The competition escalated when Chesapeake Energy and its agent, Western Production Co., entered the fray.

The Fielder Park group's email address is briarwoodestatesarlington@yahoo.com.

Update: Click here for the full Star-Telegram story on this deal.

-- Jim Fuquay

(Photo: Fielder Park)

Petrocasa/Hardin leasing in North Richland Hills

North Richland Hills resident Michaela Starrett, who last week received a lease offer from Petrocasa on behalf of Harding Co., wants her Foster Village Addition to get organized, and has taken the first step to do just that: a Yahoo Groups page at http://groups.yahoo.com/group/NRHMOA/.

"I called this weekend and found out that the offer is $1,500/acre bonus, 20% royalty, and 3-year primary term," Michaela tells us. She invites all interested neighbors to check out the page "to join and discuss."

In a related note, another NRH resident tells us he has received a similar offer from Petrocasa, which says its drilling site is on the Graham Ranch on Hightower Drive. Incidentally, Harding has a partnership with Exxon Mobil in the Barnett Shale, so you might occasionally see the Exxon name as well.

Click here to read all of Blogging the Barnett Shale's posts about North Richland Hills.

-- Jim

(Photo: First graders at Foster Village Elementary in North Richland Hills)

City gets highest bonus reported: $23,511/acre

Six acres used for a city-owned park-and-ride lot have drawn the highest signing bonus yet reported in the Barnett Shale at $23,511/acre from XTO Energy. XTO's offer, along with a 26 percent royalty, outbid Chesapeake Energy's bid of $11,888/acre and 25 percent.

A city spokeswoman said it is the priciest per-acre bonus the city has been paid. But the $134,012.70 the city will receive can't match the approximately $14 million the city was paid for its 817 acres at Meacham Airport. The airport bonus amounted to $17,111 an acre, and remains the city's No. 2 highest bonus.

The latest Spinks bonus tops any other that we've heard of. The closest competition seems to be a bonus of $18,127/acre reportedly won by Shady Oaks Golf Club and $18,000/acre won by Texas Christian University. TCU's total lease is worth more, however, because it includes a 30 percent royalty, vs. 27 percent at Shady Oaks. Shady Oaks officials have never confirmed their terms.

The highest residential bonus we know of is the $15,850/acre negotiated just recently by United Neighbors, an Arlington group with roughly 1,000 homeowners.

Click here for a copy of the city of Fort Worth's Spinks park-and-ride lease.

-- Jim

(Photo: Spinks Airport, 2005, airlifting sick children to Fort Worth from Houston before Hurricane Rita)