[Eric 951]

There is alot of misinformation and scare tactics out there regarding the process. The article cited in the initial post seems to focus on landowners feeling they didn't get enough $$$ for their leases. The wildflower farm lady did get a cheap deal 12.5% royalty is low, and her up-front bonus payments were as well. Chesepeake utilizing force majuere to extend leases is a BS move. There were many people around here that signed with various drillers(chesepeake, range, and atlas were the 3 big dogs, with Rice in the mix as well), they received the up-front payments but the companies balked when gas prices dropped and haven't drilled on their units yet.They are still under lease(for 5 years), but if nothing is done in that period, the leases expire and must be renewed.

The biggest factor is doing your due diligence. The drillers are relying on folks getting their royalty check and NOT understanding the accompanying statement--it is a semi-complicated spreadsheet. As an indiviual, you have to understand which each dedcution(compression, marketing, proeduction, dehydration, etc.) is, and each classification of product(NGL, West Gas and dry Gas).

The deductions are where they can really whack you out of royalty percentages. Depending upon how one's lease reads, there are certain post-production costs which the drillers are entitlied to deduct from the royalty payments. If you don't understand what is being deducted based upon the statements, you can lose $$$ which you are entitled to.
The drillers act as though they are out for everyone's best interest, but of course they are out for the $$$.
The bottom line is, do your homework, realize the drillers are in business to make money, review your docs thouroughly prior to signing especially for the following:

1. what deductions will be taken from your roylaty for post-production, transportation, and/or marketing?
2. what is your royalt percentage going to be?
3. How are you going to receive royalties on the various products taken from your land--oil, NGL, wet gas, and dry gas--each product is different, and you want ot recive payment for each type.
4. Does your lease limit or specificaly call-out what mineral seams are being drilled. The devonain seam, marcellus seam,and utica shale are all different and you shouldn't sign an all-inclusive lease if these (3) distinct areas are on your land.