This is Brian Conover of our CNY Landowner’s steering committee. I will be tackling the task of periodically updating our coalition website with our current position and progress. These updates will not be as frequent early on as things yet may move slowly. As we get closer to potential deals, updates will be quite frequent. Future updates will also not be as long as this initial release. One has said that the difference between a foul ball and a home run is timing. Some wanted us to go out to bid last year - an obvious mistake now easily seen by hindsight. The significant time taken to work on our lease and the glacial pace of the DEC has handed us the best scenario so far for lease negotiations. We live in the post-Friendsville era with a higher price tag put on the Marcellus shale than what it has ever been. It’s a much better climate for leasing than it was before - yet there are a number of unanswered questions and no guarantees for the future.
What’s The Latest?
Our lease is complete. The computerized maps of our coalition are nearly complete. Just before the joint coalition rally in Bainbridge, the committee worked through a number of possible factors and decided it was time to pull the trigger and have the attorneys send out letters to prospective gas companies. This letter was formulated over the following weeks and was sent out, to the best of my knowledge, around mid September. This decision appears to be well thought through and the timing looks to be as good as it has been so far for this dialogue. There has not been a reasonable amount of time for us to receive a response yet from a gas company. We will let you know what interest there is for our coalition as it comes in.
Factors To Look For!
The DEC “Regs.” As I write this, all eyes are on tomorrow (September 30th) as the date the DEC releases its GEIS which hopefully will pave the way for responsible Marcellus gas drilling in New York. These final DEC regs will either greatly speed up or gently throttle the gas company’s interest in NY coalitions.
The Gas Prices. The higher they get, the more profit margin is seen for the gas companies and the greater the lease terms should become for landowners. As of now, they are near $4.00 per thousand cubic feet. Look for them to climb as outside temperatures drop.
The Coalitions to the South. They represent the land our gas must go through to get to the major pipeline. Because they are between us and the big pipes, we may not be the next coalition in line for a deal, but we shouldn’t be far behind our friends below us on the map. Good news for them is always good news for us.
How Do We Look?
We have topped the 160,000 acre mark. Looking at the maps of our coalition, I would say that we look fairly impressive. We are a more vertical running (North and South) coalition and are pretty chunky through the middle (a trait many of us model very nicely). Every added land parcel that connects to a coalition member makes us just a little more beautiful. Keep talking to your neighbors.
Speculation abounds about the potential production of the Marcellus shale in our region, the possible bonus payments and the acceptance of the GEIS by larger gas companies. Time and a few exploration wells will eventually dispel all speculation.
So as for now, what we know, I’ll post as quickly as we find it out. Please don’t call Mr. Lasky requesting an update - it’s my job to update. Do understand that your committee is not just a committee. Every committee member has significant land invested in this coalition as well. I have interest in about 350 acres - and I’d love to have a deal to sign tonight before I go to bed. We have no reason to artificially delay this thing. Every perceived “delay” is solely for the purpose of getting the best deal with the best lease for our great coalition. And our restraint to this point has showed wisdom. It may be a month or so before we get any responses from gas companies. Check back here in the future – we’ll keep you up-to-date.