Barnett Shale

City grants drilling permit at "Trinity Trees site"

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The city of Fort Worth has granted a permit to Chesapeake Energy to locate a gas well on the "Trinity Trees" site off University Drive near the Trinity River.

The well is considered a high-impact gas well, and Chesapeake secured permission to drill the well from all property owners within 600 feet of the site, said Cecilia Jacobs, chief communications officer for the city.

The city's full statement read as follows:

"On August 30, 2007, Chesapeake Energy applied for a pad site permit on the Pearson Lease site. The site is located north of the Trinity Trail and west of University Drive. Because of concerns about the site's proximity to the Trinity Trail, the operator has complied with additional requirements for a high-impact gas well classification.

"The corresponding gas drilling permits were issued Monday afternoon because Chesapeake met the requirements under the City of Fort Worth's gas drilling ordinance."

We'll be updating this as we learn more. -- Richard Stubbe, (rstubbe@star-telegram.com, 817-390-7084)

Few rules in lease negotiations...

This is a general response to the point about different neighborhoods receiving different lease offers. There is no such thing as a "standard" bonus payment, nor a "standard" royalty payment. Every single term in a lease is negotiable, including where the drill site is located.

Two big variables affect how rich a lease a property owner can command. One is negotiating from a position of strength, whether because the landowner controls a lot of acreage in a desirable location or is part of a group of landowners who work together. The second is the level of competition for the property. That's why Dallas/Fort Worth Airport, country clubs, municipalities and well-organized neighborhoods have won the best lease terms: They control a lot of land and they manage to drum up strong competitive bidding for their property.

In general, lease terms have become richer as the Tarrant County portion of the Barnett Shale has developed and has proved to be one of the richest portions of the field. Judging by reports we have reported in the Star-Telegram, lease terms have gone from about a 20 percent royalty and a bonus based on about $2,000 an acre or less, to about a 25 percent royalty and a bonus ranging from about $4,000 an acre or more.

Click here to read about the details of Woodhaven's community lease.

Click here to read the details of Dallas/Fort Worth Airport's gas drilling deal.

Click here to read the details of the Tarrant Regional Water District's gas drilling deal.

Click here to read about TCU's gas drilling deal.

Click here to read about Colonial Country Club's gas drilling deal.

Click here to read about the University of Texas at Arlington's gas drilling deal.

-- Jim Fuquay