For those that want to be a player in a hot shale, Petrohawk executive vice president Steve Herod points out that being second on every lease is as good as being last. “You have to be willing to pay the rate to play the game if you’re going to be successful,” he said at A&D Watch’s recent “A&D–The Workshop: Unconventional Gas.” He should know: Petrohawk currently holds some 90,000 undeveloped acres in the Cotton Valley/Haynesville shale play and 155,000 in the Fayetteville shale. Speed, too, is critical in acquiring a quality position. “You can’t wait if you want to be in one of these plays. Once you make the commitment you’ve got to be willing to move quickly.” Being first in the play, however, isn’t necessary to establish a good position, he says, but it pays to have experience in knowing the good spots from the dead zones. “Not all acreage is the same.” A 500-acre block in a prime area is worth “way more than a scattered 500 acres” over 20 sections, he said. Is the land close to the pipeline? “It doesn’t do any good to have all that acreage if you can’t get the gas out.” The market can change quickly. What may be the going rate one week may not be in the market the next and real-time communication on valuation is important. You want to be first? Keep a Blackberry in your pocket and check it before knocking on that landowner's front door. Chances are he knows the up-to-the-second price per acre. Be a part of our next “A&D–The Workshop” and “A&D Strategies and Opportunities” in September. Steve Toon, Editor, A&D Watch; Contributing Editor, Oil and Gas Investor; www.OilandGasInvestor.com; stoon@hartenergy.com
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