Lease Review and Negotiations
We regularly review oil, gas and mineral leases featuring Chesapeake (Ticker CHK) as the lessee. We also negotiate changes and addenda for such leases. We therefore know a bit about this particular operator and stand ready to let our knowledge work for you.
Chesapeake As Your Lessee
We believe CHK to be a generally good lessee, particularly compared to many fly-by-night operators. CHK has the financial power and expertise to develop massive oil and gas fields. They can, in fact, do what they say. This is different from many operators who will promise you the moon when negotiating a lease but not be in a financial, technical or practical position to make good on their rosy plans to develop your minerals.
Leasing to CHK also relieves you of headaches which arise when you lease to a small group who commence fighting amongst themselves instead of developing your minerals. There is no perfect partner for oil and gas leasing, and there are certain risks associated even with CHK or similar large scale operators. But we generally look favorably on CHK as a counter-party when negotiating oil and gas leases for our clients. If you have a potential lease with Chesapeake, call us. We don't represent them, we represent you, and we are eager to help.
Chesapeake Myth: They Never Make Changes to 40 Acre Leases...They DO!
Land men, the folks who help oil and gas companies make contact with land owners and lease up their mineral acreage, often do not want to go through the trouble of negotiating detailed changes to smaller oil and gas leases, say where the net mineral acreage is less than 40 acres. This is because they are human and prefer not to do great amounts of work on little deals. But still, they must lease up the areas assigned to them and they still contact the landowners and attempt to arrange a lease. They sometimes say, however, "No changes. Chesapeake won't accept any changes on a 40 acre lease." This is untrue, since we have seen addenda (written changes summarized on a separate sheet) for 40 Acre plots with Chesapeake's signature on them. They do exist, Chesapeake will do it, and the no-changes song and dance is just that. Now there are certainly things in the lease which will not be changed, no matter how hard you negotiate, but there are others which most oil and gas companies will change with little or no argument. Don't expect Chesapeake and their land men to be delighted by the changes you demand, but NO oil and gas lease should be signed as-is. They are almost uniformly unfavorable to you as lessor and are all in need of review by a trained professional. Chesapeake and their land men know this. If you are having trouble with a Chesapeake deal, call us.