AboutCharles E. Felker Expertise Energy questions related to homeowners and their energy supplier.
Questions related to process control.
HVAC questions
Natural gas transmission, distribution.
Experience Penn State grad 1954 in Petroleum and Natural Gas Engineering. Forty five years experience in process control, natural gas processing, compression, transmission and distribution
Organizations ASME
Education/Credentials BS Petroleum & Natural Gas Engineering Pennsylvania State University
Question QUESTION: i have 100 acres in wayne co pa and recently signed a lease with hess....are they a godd co and how long will they take to pay. also what would you guess royalties would be with 600 acre pools-i have 100 acres.
thanks
ANSWER: This is really a guess but based on the info you provided it would appear you have 1/6 interest and if the royalty is 1/8 looks like you get 1/48 of the production. Now if we assume the well produces 1,000 MCF per day at $3 per MCF looks like your share would be $6.25 per day. You know that nat gas prices have declined dramatically where just months ago it was going for $14/MCF its now at $3. I'm surprised Hess is actually drilling into the Marcellus Shale since they will go vertical and horizontal at big bucks. I would really appreciate hearing back from you if/when Hess actually drills and what they provide as production numbers. Thanks
Chuck
---------- FOLLOW-UP ----------
QUESTION: Thank you Chuck for your answer. I realize this is our conversation/speculation and with your expertise I just like straight as you have given it tom me I appreciate very much. Did I mention to you that I signed at $3,000.00/acre paid out over a 5 year period with 20% royalties. I will definitely keep you informed where we are with this project. Can you explain to me what you mean by your surprise of Hess actually drilling into the Marcellus Shale because of "they will go vertical and horizontal at big bucks." From what I have been able to find on the internet, Marcellus can only be mined with horizontal drilling and fracing process. I look forward to your great feedback.
My best regards,
Julia Tunkel
Answer The only thing I meant with the word "surprise" was since the well head price of gas has dropped dramatically (from $14 to $3 per MCF) in the past few months I am surprised they don't hold off for a while actually drilling. The process for "drilling" the Marcellus is to go conventional drilling vertically until they get to the Marcellus then they go horizontal when drilling has reached where they want to stop then they will "fracture" to improve production. Thanks for the information, and keep in touch.
