Barnett Shale

Carter Avenue, update II

Jerry Horton, who has been fighting a _natural_gas_pipeline planned beneath her front yard on Carter Avenue in the West Meadowbrook neighborhood, was served with condemnation papers this afternoon.

Watch tomorrow's paper or Star-Telegram.com for the full story.

-- Mike

Online lease auction site aims at large landowners

Lease Auction House L.P. is the latest approach to helping landowners win the best leasing terms for their mineral rights. The Fort Worth company is currently dealing with potential customers and hopes to hold its first online auction in September. Taylor Green, the company's director of business development, says large landowners, with perhaps 100 or more acres, are shaping up to be the prime market. And while Lease Auction House is based in the heart of the Barnett Shale, the most activity is coming from Pennsylvania and West Virginia, where landowners are less familiar with the industry, Green says. The company's also hearing from landowners in New York, Louisiana and Arkansas. She said landowners can use their own lease, work with a lease the auction house has worked up, or deal with their own attorney to create a lease. The company is headed by CEO Rhett Bennett. Free registration is required to see the auctions, but there aren't any properties loaded into the site yet.

Jim Fuquay

What does $11.68 billion buy these days, anyway?

So, Exxon Mobil made $11.68 billion in the second quarter. Which raises the question: What would that kind of money buy?

• 29,200 President Bushes for a year, at his $400,000 annual salary.
• More than 10 Cowboys stadiums, at their current $1.1 billion price tag.
• 467 Alex Rodriguezes, at $25 mil per year.
• 179 Bass Halls, at its $65 million construction cost.
• 486 F-16s, at $24 million per copy.
• 113,840,155 roundtrips from Fort Worth to San Antonio in a Chevy Tahoe, at $3.80 per gallon. Who says you don't get value from the big SUVs?

-- Scott Nishimura

Mr. Gas wants ... more gas

Aubrey McClendon, dubbed Mr._Gas_ by Fortune Magazine, testified to a Congressional committee Wednesday.

No surprise, he called for more production of natural gas. He also said the government should equip its fleets of vehicles to run on compressed natural gas, and provide incentives for gasoline stations to sell CNG to consumers. Homeowners who have natural gas connections at their houses might even be able to refuel their CNG vehicles in their garages, he said.

Read it here:

AKM_US_Congress_Testimony_FINAL.doc

-- Mike

Carter Avenue update

Jerry Horton said she called Mayor Mike Moncrief's office to apologize for her confrontation with him at Tuesday's City Council meeting. Loyal readers will remember that she accused the council of failing to protect neighborhoods from pipelines, and Moncrief gaveled her down.

Meanwhile, more than 200 people turned out Wednesday for a meeting on the Carter Avenue pipeline. Read the story here:

http://www.star-telegram.com/804/story/796952.html

-- Mike

Chesapeake takes a breather in Southlake

If Chesapeake Energy wasn't already reining in its leasing efforts in Southlake following passage of a tough new drilling ordinance in the Northeast Tarrant city in May, it certainly appears to be doing it now. At a public meeting Monday night, Chesapeake public affairs representative Lisa Powers told an audience of about 185 residents and city officials that the producer "is not aggressively seeking additional leases" in the city, where it has secured two potential drill sites. Some attendees said they thought Powers was saying Chesapeake was suspending leasing efforts in the city.

Tuesday, Powers told us it's more of a slowdown. "We're focusing on other areas," she said. Besides the company's problems with the ordinance, she said, "the pipeline costs in Southlake are twice what they are in other areas. With the drop in the price of natural gas," Chesapeake isn't interested in adding to its leases in the city right now. Powers said the city's fees of $15,000 for a special use permit for each drill site, plus $8,500 per well, are high compared to an average of $3,000 to $4,000 for drilling permits throughout the Barnett Shale.  When Southlake City Council was debating the ordinance, passed May 20, Chesapeake submitted written comments noting that restrictions on holding ponds for water and water storage tanks could prevent production. Chesapeake and XTO Energy at the time had been busy signing mineral rights leases in the city and surrounding area. XTO was scheduled to speak at Monday's meeting but a representative did not show.

John Terrell, a Southlake Councilman and mayor pro tem who attended the meeting, said Tuesday that "my perception is, this was at least a partial statement to indicate Chesapeake was not thrilled with our ordinance. At the same time, Chesapeake did not indicate they were going to stop doing business in Southlake, but they're slowing down." He said the company could be getting ahead of itself by complaining about the ordinance before it even applies for a permit. "It's difficult for the gas companies to know how difficult it's going to be" to get a permit, Terrell said. He said that while some at the meeting seemed to back the company, "a lot of people expressed support for the ordinance."

For our previous coverage of Southlake's drilling ordinance, click here:

Download southlake_ordinance_report.doc

-- Jim Fuquay

Update on Carter Avenue

Jerry Horton, who got a letter giving her until Monday to sign off on a pipeline easement or face condemnation, had not been served condemnation papers as of Tuesday.

She still stirred the pot, getting in a shouting match at City Hall when she tried to protest the pipeline.

The City Council allows anyone to make a three-minute comment at the end of each meeting. And the council had already gotten an earful from another urban drilling opponent, who said the city committee that is writing new drilling rules is stacked against homeowners.

Councilman Jungus Jordan said the city council is going to have the final say, and added "We're going to protect neighborhoods."

When Horton's time came, she  called Jordan out, saying "you have not protected us."

That drew the wrath of Mayor Mike Moncrief. There's a rule against attacking individual council members during the comment period. Moncrief, too, said the city is doing its best to protect neighborhoods.

"You have not supported us," Horton shot back.

That led to a back-and-forth, with both Horton and Moncrief raising their voices.

"Do you want to abide by our rules or don't you?" Moncrief asked.

"I want you to save my street," she replied. "I'm not attacking, I'm making a statement. Let me have my three minutes."

At one point, Moncrief banged his gavel and threatened to recess the meeting if she didn't stay on track.

"You can go to recess, but they're gonna take my front yard and they're going to take your front yard, too, and they're going to take this whole city," Horton replied.

She closed by saying she would try to vote the entire council out of office.

-- Mike

Chesapeake speaking Chinese?

For what it's worth, the South China Morning Post reported in its Monday issue that China National Petroleum Corp. is interested in buying into Chesapeake Energy's shale gas properties. The story doesn't have any named sources and there's no comment from the company, but the Oklahoma City-based company's shares were up more than their peers in U.S. markets. A summary of the story by news service Reuters is here.

-- Jim Fuquay

Pipeline updates

It's going to be a big week for natural gas pipeline news. Here are the highlights:

Today is the deadline for at least one resident on Carter Avenue to sign an easement for a pipeline through her front yard or face condemndation. We're still waiting to see the results. Read the previous stories here:

Eastside_neighbors_oppose_natural_gas_pipeline

Homeowner_sent_final_offer_on_pipeline

Another Carter Avenue resident got a letter by e-mail from her daughter, who is serving in Iraq, objecting to the pipeline, and to critics who she says have belittled the neighborhood. Note: She lives on the other side of the street from the proposed pipeline, so there's little chance she'd have the pipeline beneath her yard.

Read the letter here: Carter_Avenue_letter.doc

The Meadowbrook Neighborhood Association is having a meeting to discuss the pipeline and gas drilling at nearby Tandy Hills Nature Center at 6:30 p.m. Wednesday at Meadowbook United Methodist Church, 3500 Meadowbrook Drive.

-- Mike

Hollis R. Sullivan among sellers of Barnett properties to XTO

Hollis R. Sullivan, the Wichita Falls-based producer that has been active in the Barnett Shale, was identified Thursday as one of the sellers of $800 million worth of producing properties and leasehold to XTO Energy. XTO disclosed the purchase of 12,900 acres in the Barnett Shale in a Securities and Exchange Commission filing. The filing says Sullivan and other mineral interest owners sold properties in Johnson, Tarrant, Parker, Wise, Hood, Hill, Ellis and Bosque counties. The transaction is expected to close by Oct. 1.  XTO said on Wednesday it will sell at least 26 million shares at $48 each to help finance the deal.

For the Star-Telegram's news report on the transaction, click here: Download xtoonline.txt

-- Jim Fuquay