East Texas Lease Acquisition Project
8
Minutes
Written by
Blake Armand
Project Background
Large-scale lease acquisition projects have become increasingly rare in East Texas, with most leasing activity shifting to West Texas due to technological advances in fracking and fluctuating natural gas prices. However, a recent project represented a valuable opportunity to develop a lease position in an underexplored area of the Haynesville Shale formation.
Client Objective
The client tasked the team with acquiring as many net acres as possible in an area on the fringe of the Haynesville Shale formation.
Despite existing gas wells/units and federal lands not being available for lease, the area offered substantial opportunities to generate a lease block large enough for the client to test a slightly different zone than previously established.
Project Hurdles & Strategic Approaches
The project presented several complex challenges requiring innovative solutions:
- Staffing 20-25 Landmen to begin work immediately
- Identifying existing units and federal lands
- Conducting title research and leasing activities simultaneously
- Acquiring leases from larger landowners to discourage competition
- Reviewing lease addendums before client presentation
- Providing accurate reports and mapping to satisfy client requirements
Assembling an Expert Team at Record Speed
The project demanded rapid deployment of 20-25 Landmen for immediate title work. While a few long-time Dudley contractors were identified as project leaders, the existing talent pool was limited due to competing projects.
Our recruitment strategy combined LinkedIn outreach with personal recommendations from existing Dudley contractors. This hybrid approach proved highly effective, enabling the team to staff 25 contract Landmen within a few weeks, eventually scaling to 54 contractors as the project expanded.
Mapping the Unknown: Creating a Clear Picture
With limited information on existing wells and units within the Area of Interest (AOI), the team needed to build a comprehensive map to guide acquisition efforts.
The team leveraged Enervus/DrillingInfo to identify current leases and wells/units, allowing them to eliminate acreage not available for lease. The GIS department downloaded and integrated this information onto project maps, providing a clear visual guide for the acquisition team.
Research into federal lands involved obtaining BLM maps and establishing valuable contacts at the forestry department.
This investigation revealed that federal lands were unavailable for leasing due to political factors and the absence of required environmental impact studies. A detailed reference memo documented all findings on federal lands for future use.
Fast-Track Acquisition: Title and Leasing in Tandem
Rather than waiting for complete title work, upper management directed an immediate start to leasing efforts, requiring a carefully coordinated approach between title and leasing activities.
Lease buyers utilized lease check spreadsheets from Enervus to begin contacting mineral owners from day one. As lease commitments were secured, title agents were promptly notified to begin title work on those specific tracts, creating an efficient feedback loop that accelerated the acquisition process.
To minimize expenses, one Landman worked directly at the courthouse to access records not available online. This strategic positioning allowed remote title work to be supplemented with courthouse records like probate files and tax maps without requiring multiple team members to travel.
Strategic Targeting: Winning the Acreage Race
The cornerstone of the acquisition strategy was to secure the largest acreage blocks first, establishing a dominant position with minimal effort and deterring competitive interest.
By quickly identifying and securing leases from major landowners, the team established a substantial position before competitors could gain traction.
This early advantage proved decisive – competitors eventually abandoned their efforts after recognizing they couldn't establish a viable position, with some even relinquishing commitments they had already made.
Face-to-face meetings with larger landowners proved especially effective. The team arranged in-person meetings and traveled to meet key landowners, building relationships that competitors couldn't match and securing commitments that might otherwise have been lost.
Optimizing Client Communication: The Expert Filter
With the client handling the project individually, lease addendum reviews became a bottleneck, slowing response times to mineral owners in a competitive environment.
The solution came through adding a senior Landman who provided expert review of leases and addendums before client submission. This additional layer of expertise ensured all requirements were addressed and dramatically reduced turnaround times from weeks to days – a critical advantage in securing commitments from landowners.
Precision Reporting: Building Trust Through Accuracy
The client's reporting standards demanded exceptional accuracy, with even minor discrepancies prompting immediate follow-up. For example, a mere 0.5-acre discrepancy in a weekly report triggered a call to identify the source of the error.
The team responded by fine-tuning reports to meet exacting specifications and delivering reliable weekly updates. Beyond basic reporting, the team created detailed maps and shape files categorizing every aspect of the leasing effort, making it easy for the client's GIS team to visualize the evolving acquisition landscape.
Project Results & Future Potential
Despite being placed on temporary hold due to natural gas prices, the project successfully established a commanding position in the target area. The client expressed satisfaction with the result, recognizing that any future development in the area would necessarily include their acreage.
By the Numbers:
- Leased position: 12,186 gross acres / 7,029 net acres across 130 tracts from 165 unique owners
- Additional potential: 395 gross acres / 5.9 net acres in active negotiations
- Comprehensive coverage: Title examination completed on 27,730 gross acres / 27,729 net acres
Looking Forward
The East Texas Lease Acquisition Project demonstrates how effective solutions to complex leasing challenges – from strategic staffing and coordinated operations to targeted acquisition and precision reporting – can create lasting value even in challenging market conditions.
While currently on hold due to market factors, the established position provides the client with valuable development opportunities when conditions improve.
Partner With Dudley for Your Next Project
Facing similar challenges with your lease acquisition needs? Dudley Land Company brings decades of experience, a vast network of skilled land professionals, and proven strategic approaches to maximize your position while minimizing costs.
Contact us today to discuss how we can help you navigate complex terrain and secure the acreage you need.
