Conventional producers team up to survive low commodity prices, competition from shale drillers
Tuesday, September 15, 2015
Just like landowners pool together to negotiate with oil and gas companies, conventional oil and gas operators are banding together to market to shale firms.
To keep businesses afloat, independent conventional oil and gas producers are pooling their deep oil and gas rights with plans of marketing them to a private equity fund, Pittsburgh Post-Gazette PowerSource reports. One such pooling in western Pennsylvania, Vintage Land Holdings, will total 40,000 acres that will sell for $200 million to $300 million.
Several years ago, more than a dozen conventional producers were brought together to market to shale companies. However, the deal didn’t end up being all-or-nothing, but conventional operators say it’s time to try it again.
Via: Pittsburgh Post-Gazette PowerSource > Conventional oil and gas producers band together to survive
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Shale FAQ
How often do royalty payments come?
Depending on the company, royalty payments can arrive monthly or quarterly.
Are my royalty payments transferable?
Yes. If you plan on selling your property, notify the gas company that is leasing your land and your realtor. They will make arrangements to allow the royalty payments to transfer to a different land owner.
What are royalties?
Royalties are payments from the gas company to the landowner as part of a lease agreement. Royalties payments cannot begin until production begins. The payments are dependent upon the market price of the resource.