Carrizo Oil & Gas has allocated $385 million of its $500 million development budget to drilling & completing wells in the South Texas Eagle Ford. The company plans to keep three rigs running in the play throughout 2013. [Read more…]
Lawsuits over the nature of mineral leasing and the high stakes game of who owns and who leased first is a multi-million dollar issue in South Texas. Everyone sells land and leases minerals happily until acreage prices skyrocket. That’s when the lawyers come out. That’s when people realize they might have missed something very big. The gravy train of $10,000+ per acre lease bonuses and long lived royalties might have passed right by. Often times, real estate trades for fractions of the dollar before oil or gas is discovered.
In a 1-2 year time period in Northern Louisiana, acreage prices in the Haynesville Shale increased from less than $3,000 an acre (that was good) to sell land and mineral rights to simply leasing minerals for as much as $20,000 per acre. Prices have come down, but the boom is much like what we’experiencing in the Eagle Ford.
The dollars involved also increase the likelihood of fraud. There will no doubt be bad apples, but companies do their due diligence on title and many of these issues are resolved before leasing. If you are leasing, always do research to make sure you’re working with a reputable party.