August 6, 2008

Lake Worth Neighborhoods Working on Record Gas Lease

By Jim Fuquay, Fort Worth Star-Telegram, Texas

Aug. 6--A group of neighborhoods covering about 650 acres just east of Lake Worth is negotiating a mineral-rights lease with Chesapeake Energy that includes a $30,000-per-acre signing bonus, the highest known bonus paid in the Barnett Shale.

It would top the previous record of $27,200 won from Chesapeake in May by a Burleson group.

The landowners, whose property is in the cities of Lake Worth and Fort Worth, and Chesapeake have agreed on the financial terms and are working on environmental considerations, negotiators said.

About 1,200 property owners in Boat Club Estates, Highland Lake Estates, Jinkens Heights, Crestview, Crestridge, Triangle Estates and Lakeview Estates are involved in the lease. The land is roughly bounded by Lake Worth to the west, Azle Avenue to the south, Boat Club Road to the east and Basswood Court to the north.

Jerry Welch, a negotiator for Boat Club Estates, said the group didn't set out to set a record, but a last-minute bid by XTO Energy pushed the process to a head. The lease also carries a 25.25 percent royalty.

"We made an offer, and they said they'd take it if we would end our negotiations now," Welch said. The groups had been dealing with Chesapeake for months, he and others said, and decided to stick with the Oklahoma City-based company.

"That is certainly a good offer," Jerri Robbins, a Chesapeake spokeswoman, said Tuesday. She said the company has been actively working the Lake Worth and Eagle Mountain Lake area.

Over the weekend, Chesapeake also won the endorsement of the Ridglea Hills Neighborhood Association for a mineral-rights lease that pays a bonus of $25,000 per acre and a 25 percent royalty. The neighborhood includes about 1,600 property owners and 640 acres, said Bob Bashein, president of the neighborhood association's executive committee.

"It's been nine months of drudgery. The first letter from Chesapeake last October was for $5,000 and five years. We negotiated that to $25,000" and a three-year lease term, Bashein said Tuesday. No signing dates have been set.

XTO was also in the running for the Ridglea Hills lease. The neighborhood is bordered by Camp Bowie Boulevard to the north, Ridglea Country Club to the east and Texas 183 to the south.

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