«

Aug 17

Summer 2017 Update on Gas Leasing for NHMOC

Back in 2014 we held meetings with the Caffey group to try and arrange a deal for our members on a gas lease. We supported The Caffey Group in the City Hall meeting where they applied for a pad site permit at the old North Hills Mall. The permit was approved for five years, which will expire in June of 2019.

Natural gas prices fell due to supply and demand. We realized this may be a long term project so we made a deal with Caffey that he would pay for our fixed expenses for the website, internet connection and land line phone for the Coalition. He has done that and we are prepared to maintain the website for at least three more years.

While natural gas prices in the US had dropped to $2.00 per BTU in 2016, they have risen to $3.00 currently, and have been projected to reach $4.00 by the end of the year. Four dollars, according to Caffey, would make it economical for them to lease mineral rights and start drilling. The price of Natural gas in Europe, China and South America is about $5.50 and the US is now exporting LNG. There are three new plants along the coast that are turning Natural Gas into LNG and shipping it overseas. There is a new pipeline under construction from the Permian Basin to Mexico to export Natural gas. The increase in Natural gas exports will increase the demand and raise the price to make it profitable to drill more.

It is possible that The Caffey Group will drill before their permit expires in June of 2019. We have over 2,000 members in the area reachable from the pad site at the old mall, including Car dealerships, the North Hills Hospital, and even the mineral rights to part of 183 north of the North east Mall.

The NHMOC is alive, and has the resources via the website and our mailing list to contact members when and if we begin negotiations on a mineral rights lease. Hopefully we will have more information to share in the next six months.

Paul Lee
President, NHMOC

If you enjoyed this post, make sure you subscribe to my RSS feed!