Read more on Jay Hancock's Blog in the Baltimore Sun Business section.
"At stake among other things are millions of dollars for Garrett County farmers with potential wells on their land."
Read more in the Baltimore Sun.
Don't forget to check back to Dan's Deep Creek Blog for your future updates on Deep Creek real estate statistics.
Read more on Yahoo! Finance, Yahoo! News, ABC News, The Seattle Times, etc.
Don't forget to check back to Dan's Deep Creek Blog for your future updates on Deep Creek real estate statistics.
apparently the sharp downturn in the economy has left more than a few individuals and companies strapped for cash as it seems Lodge Energy can no longer afford to pay out lump sums for leasing rights (and thus wants to make payments over a number of years instead). I've read about other natural gas companies being forced to sell assets to raise cash as well. It seems some of them over-reached thinking natural gas prices would go up indefinitely (where have we seen this story before). At any rate, read more on this Garrett County natural gas story in the Baltimore Sun and stay tuned to this blog for future updates.
Updated 12/15/08 to respond to a direct question from a reader: BM below you will see a heading to one of these leases as well as clause 4 and in a separate image clause 10 as well. Together it looks like these in effect give the gas company the opportunity to back out of the lease if they choose to do so. The images shown can be enlarged by clicking and originated from public records.
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read the full story in today's Cumberland Times-News. Wind turbine set-backs and taxes on natural gas lines are just a few of the items on the agenda.
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from the Maryland Geological Survey. A number of photos and detailed links are provided in this single link.
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According to a Penn State geoscientist in a new AP article the Marcellus Shale may yield as much as seven times the natural gas many have been expecting. If this turns out to be the case, it would no doubt be a huge windfall for local property owners who have leased their mineral rights to natural gas companies in exchange for an upfront payment and royalties for a percentage of the value of extracted gas. At this point, I'm very surprised that we have not heard from the local wind turbine opposition groups on this matter as well. Stay tuned.
Don't forget to check back to Dan's Deep Creek Blog for future updates.
Don't forget to check back to Dan's Deep Creek News Blog for future updates.
Don't forget to check back to Dan's Deep Creek Blog for future updates.
Read more in the Cumberland Times-News. One quote I found interesting, and in direct contrast to the horror stories commonly repeated in the local letters to the editor, is that of Judy Pletcher who had the following to say:
“We are very proud, as landowners, to be part of the alternative fuel resources in our country. We had a very positive experience, and hopefully we’ll see more projects like this in the area.”
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Don't forget to check back to Dan's Deep Creek Blog for future updates.
and once again, it's in the Baltimore Sun and features quotes from local residents as well a photograph and a map. T. Boone Pickens even gets a mention in the article for helping to cause a "paradigm shift" in the US. I'm still somewhat puzzled that the local papers are seemingly ignoring this story but still it is good to know that someone is out there telling it. In fact, I had not seen this article myself until I noticed an unusually large number of "Garrett County natural gas" Google searches landed on this blog on Sunday.
Here are some comments from local resident Henry Bowser who, like me, is interested in maintaining the rural heritage of Garrett County and hopes these upfront lease payments will allow landowners to hold onto their land and stave off development.
Bowser said many landowners will likely spend the payout on property taxes and land upkeep - to ward off economic hardships that force some to sell to companies developing property around tourist-popular Deep Creek Lake.
"For farmers and people like us who have fairly large tracts of acreage, it's a way to keep the property from being sold and broken up," Bowser said.
"There is so much selling and splitting up of property in this area, with the development around the lake. For the people still trying to keep Garrett County as a rural area, it makes it a lot easier for them to hold on to their property."
Aubrey McClendon of Chesapeake Energy Corporation is joining with the PickensPlan to promote natural gas as a transportation fuel and help reduce our dependence on foreign oil. Learn more at cngNow.com. I think you have to admit that their message, i.e. keeping dollars here by using our own resources instead of relying on others, makes a lot of sense even if you don't completely agree with the entirety of the plan.
Full disclosure: given all that I am reading and that natural gas is a North American resource that can help supply us with the energy we need I plan to purchase a small stake in this business. Some people would call that practicing what you preach, but I see it as something that can improve our future and I can buy a piece of right now. The risk of course is what happens to natural gas prices (and their profits) when all these new sources of supply are opened up and it is not widely adopted as a transport fuel? That's why I'll buy a small stake now (at nearly 50% less than it was selling for earlier this year) and add to if the opportunity presents itself later. To borrow a line from real estate agents though - they're not making anymore natural gas - at least not on the human time scale.
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if you are up late this evening check out T. Boone Pickens on The Tonight Show with Jay Leno. Pickens will have a tough act to follow though as Matthew McConaughey is the headline guest this evening, presumably wearing a shirt too which in itself would be news.
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I've been trying to look around and see what else I could find on the subject and attempt to come up with a better idea of what this all means. In my searches I found this piece on the Marcellus Shale from Seeking Alpha which I have previously alluded to as a great source of information for the individual investor. The author notes a number of big and small players in the natural gas sector, but there is no mention of or reference to "Lodge Energy" which was mentioned in the piece from the Baltimore Sun. Maybe they are a division of one of the larger players or simply a smaller, under-the-radar firm. Either way I would like to know their story, so I will continue to look for more answers.
Much like the price of a barrel of oil, the well head price for natural gas tends to fluctuate quite a bit based on a number of different factors. Recently, these natural gas prices have generally ranged from about $5 to $10 per 1000 cubic feet. According to the Seeking Alpha article it may be possible that each vertical well spaced on 40 acres in the Marcellus shale contains 1 billion cubic feet of natural gas reserves and each horizontal well spaced on 80 acres contains 2.5 billion cubic feet of natural gas reserves. Do the math on the more conservative reserves number (even though as I understand it horizontal drilling is the preferred technology) and that is 1 million times roughly $10 which times 15% is $1.5 million over time on top of the initial land lease payment. Even at $5 per cubic foot that is another potential $750,000 per 40 acres. Needless to say these numbers could really start to add up IF there is as much natural gas under Garrett County as some believe and IF I am understanding what the Baltimore Sun is reporting.
As I learn more I will be sure to share it here on the blog so stay tuned. Eventually you might even see something about this in the Cumberland Times-News or the Republican. From what I am hearing secondhand from some land owners involved in the consortium it's a done deal and lease agreements are in fact in place.
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As first reported by the Baltimore Sun's Jay Hancock and according to Garrett County's own Delmer Yoder a tentative deal has been reached that would pay a consortium of Garrett County land owners $1,150 per acre to lease 31,000 acres of land for energy exploration and development in the Marcellus Shale. Additional revenue sharing and royalties appear to be included in the deal that could make some farmers into Garrett County's newest millionaires. The leasing rights alone could bring over $35million in income back to Garrett County.
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and it's not gasoline or diesel or ethanol or liquid coal. It's natural gas. Read more in the New York Times.
Don't forget to check back to Dan's Deep Creek Blog for future updates.
Also refer back to the posting I made at the beginning of June suggesting to the people of Garrett County that natural gas could be used as a transportation fuel. I never really got around to addressing that issue as completely as I had planned but I think Boone is doing an adequate job of doing it for me now.
Don't forget to check back to Dan's Deep Creek Blog for future updates.
Don't forget to check back to Dan's Deep Creek Blog for future updates.
