Utica landowner sees sharp drop in royalty payments
Thursday, August 27, 2015
Lower commodity prices and slowed production have been in the news for months, but with those lower prices comes lower royalty payments. The Business Journal reports that one local landowner, Robert Crosser of Lisbon, Ohio, has noticed dramatic decreases in his monthly royalty payments from Chesapeake Energy Corp.
Production at Chesapeake’s well on the Crosser property began last year, with royalty payments coming in at more than $100 an acre. Today, the royalty checks pay about $20 or $25 an hour. Other landowners are experiencing similar situations.
Even though the industry is slow, drilling companies aren’t abandoning the Utica Shale. Companies like Chesapeake are renewing leases for properties that haven’t been drilled yet, and activity in the central and southern areas of the Utica hasn’t completely dried up.
Via: The Business Journal > Royalties Collapse in Utica as Oil Prices Finish
One Comment
Leave a Comment
Marcellus & Utica Shale Well Map
Additional Shale Maps
Shale FAQ
What is fracking?
Fracking is a slang term for hydraulic fracturing. Fracturing is a process by which highly pressurized fluid is pumped thousands of feet into the ground to fracture rock formations. The goal is to release the natural gas that’s locked inside the rock.
Is it safe?
What most concerns people about fracturing is ground water contamination. The worry is that fractures underground, caused by the process, will extending upwards and into aquifers, releasing gas and chemicals into the ground water supply. There’s been no confirmed reports of such a thing happening. Though surface spills and drill site blowouts can lead to localized environmental concerns.
Will my water catch on fire?
Flammable water is caused by the release of methane gas into a drinking water supply. Methane gas occurs naturally and can be released by any kind of drilling, including water wells. In Pennsylvania officials fined Chesapeake Energy $1 million for contaminating ground water with methane. It was determined that the company had not properly cemented it’s boreholes and gas migrated up the well, between rock and into aquifers.
Describe the land owners Royalty. Not the well investors. Is there a standard rate in the industry?———-Floyd