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Eagle Ford Shale - Oil & Gas Discussion

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Eagle Ford Shale - Oil & Gas Discussion

Oil & gas discussion group for those interested in Eagle Ford Shale. Share your experience regarding lease bonus, royalty rates, drilling activity, and oil & gas news.

Website: http://www.eaglefordshale.com
Location: South Texas
Members: 434
Latest Activity: Aug 22

Discussion Forum

Gambit Oil Company - Bankruptcy - Have seized leases been released by the courts - yet?

Started by Jayne Burgin Stokes Aug 1. 0 Replies

Hi Everyone - does anyone know if Gambit Oil Company's seized leases have been released yet? I have 30 acres in the Bermuda Colony in Dimmit County that were seized and now tied-up in bankruptcy…Continue

Royalty Payments getting lower and lower and lower....

Started by Robyn Barziza Chargo. Last reply by Jayne Burgin Stokes Aug 1. 7 Replies

Hi all..My 2 siblings and I inhereted about 15 acres of mineral rights and lease to EOG.  We were soooo excited...in the beginning....since we've been getting payments (about 6-7 months) they have…Continue

Eagleford Update

Started by John Sabia. Last reply by Rock Man Jan 14. 19 Replies

As a mineral owner in the Eagle Ford, Vine Royalty likes to stay up on trends and happenings in the shale. Below is a list of moves made by the big operators in the Eagle Ford. Let me know what…Continue

Keywords: Natural, Resources, shale, Pioneer, Noble

2015 Review

Started by John Sabia Jan 6, 2016. 0 Replies

Overall, 2015 was a bust for the oil and gas industry. It has forced U.S. drillers and operators to cut down capital budgets by the billions. Law firm Haynes and Boone LLP on Dec. 4 released its “Oil…Continue

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Comment by Ed Cuellar on August 9, 2017 at 3:24pm

There was an article in the SA Express News last week about lawsuits in Eagle Ford regarding royalties.  It also mentioned the issue of "drainage" as being part of the legal action.  It has to do with wells on neighboring ranch being drilled so close to the lease line that it is same as taking minerals from adjoining ranch. Not sure if it applies on my situation but I would like to hear from someone that may have more knowledge on this.  I do have a Dimmitt County Ranch.

Comment by Rock Man on August 1, 2017 at 2:53pm

Limiting your lease to "vertical wells only" will take you out of consideration for any horizontal and usually frac'd well - which is the only way many horizons will ever be drilled by operators.

This would include the Eagle Ford, Austin Chalk (in most cases), Buda (in most cases / vertical Buda wells are a rarity), Pearsall Shale and shallow Upper Cretaceous sands like the Olmos / Escondido / San Miguel.

Comment by Jayne Burgin Stokes on August 1, 2017 at 2:49pm

Adding to previous inquiry: :)
Question: Does adding the 'condition to drilling' i.e VERTICAL Wells only - take me out of the market?
Backstory: I have been in the Dimmit County 'oil play' for over 30 yrs & understand that my family's acres are over the Buda and do NOT need to be 'fracked'... therefore, I will request VERTICAL wells only be drilled - there has been one very successful vertical well drilled w/in feet of our property, however, it and the other acres were seized by the Bankruptcy Courts 3+ years ago.
Thanking you in advance - Jayne Burgin Stokes


Comment by Sheryl Prestidge on August 1, 2017 at 1:25pm

I have a San Miguel well for sale in Valley Wells please contact me if you're interested. 

Comment by Charles Newton on July 5, 2017 at 9:13am

Mr. Archer and Mr. Vinson, Thank you for replying to my message. I appreciate your extremely informative input.  I was able to increase the bonus to $650/net mineral acre.  Wildhorse (who acquired our lease from Clayton Williams) exercised the 3 year option which contained a 22.5% cost free royalty.  Again, thank you very much!

Comment by Martha McMorries on June 24, 2017 at 4:06pm

Mr Archer, What county?

Comment by William Douglas Archer on June 24, 2017 at 9:30am
Charles, i agree with Mr. Vinson that the offer seems low and i think that is obvious by their desire for six years of control via the requested three year option. That option benefits the Lessee, not the Lessor. If market were to crater, they will not exercise. If market surges, you can bet they will exercise. Heads they win, tails you lose.

I have been doing 18 to 24 month leases and when i can i have inserted a drilling obligation. Failure to drill results in an additional payment to me in what has been about 50% of the additional bonus.

Keep the bonus as you might neec to have an attorney encourage compliance as sometimes they fail to understand the definition of obligation.

Most recent EF deal i did was 750 bonus, 18 month term, 25% cost free royalty.

Good luck
Comment by Michael T. Vinson on June 24, 2017 at 9:05am

Mr. Newton,

I am afraid that is a pretty poor offer.  You are correct that there are several wells being operated on that tract.  Most appear to be drilled in the Austin Chalk formation with marginal to decent production.  One was drilled in the Eagle Ford formation in 2014 and is producing at over 3,000+ bbl a month.

If you don't mind sharing, how many net mineral acres do you and your brother own in this tract?  There more you have, the more leverage you will have.

I would think you could get well over $650 since that tract of land has established production.  I am hesitant to throw a number out as I am unfamiliar with Burleson County, and haven't worked in the Eagle Ford for some time.  A three year lease is fine, but I would not do a 3 year option.  A 2 year option may be reasonable if the operator has a lot of leasehold, numerous wells to be drilled, logistics of moving rigs, etc.  Anything more is not reasonable.  Anything less may be reasonable depending on the circumstances.  But in your shoes, I would probably say no thank you to an option.  As far as royalty, you need 25% because there is established production.  You may decide to go slightly lower with a substantial bump in bonus.  Last, make sure your terms are good.

Below is your tract, well the one right smack in the middle with "Porter" labeled on it.

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Comment by Charles Newton on June 24, 2017 at 3:59am

My brother and I own mineral rights in the JW Porter Survey, A-195, Burleson County.  Brett Harris of Harris Land Co. contacted us concerning a desire to extend our lease for an additional 3 years with a 3-year option.  He is offering $200/net mineral acre as a signing bonus with a 3-year option for $200/net mineral acre on behalf of Wildhorse Resource Development.  We were able to attain $650/net mineral acre from Clayton Williams in 2014 so the offer from Mr. Harris is sharp decrease in bonus amount.  If possible, I would like to find out the "going rate" for other mineral rights owners in the area.  According to http://www.texas-drilling.com/operators/wildhorse-resources-mngt-co..., I’m almost positive that Wildhorse has 2 wells in A-195 so it seems like we would be justified in asking for an increase in bonus.  Any input would be greatly appreciated.  Thanks!

Comment by Andy Lark on March 27, 2017 at 3:10pm

Greetings!  Does anyone know of the going rate for large water sales (for drilling and fracking purposes) nowadays in the Eagle Ford Shale area?  (I'm in the McMullen/Live Oak County area of TX, if it matters.)  Water was selling, I believe, for 50-cents/barrel some years back....  Many thanks for any information that you can please soon provide.  Thanks!

 

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