Hello, all.
We received an Oil,Gas and Mineral Lease in 11-13-6 for $1,500; 3/16; 3 years.
From what I have seen here and Oklahoma Mineral Owner Registry, it looks about right. Are any of you aware of other offers (same, better, worse) in this area?
Thanks, in advance for your input.
Payrock pooled sec 15 just catty corner to you in April. They offered $650 3/16ths or $650 and 1/5th so your offers are higher which is good. Always ask for 1/5th and 1/4th to see what they will say. The lease that they offer you is probably not what you actually want since it will most likely be all in the operator's favor. You need to negotiate some of the unfavorable clauses out and get better ones. Friend me if you need some help. Blue icon to the left.
Limit post production expenses, prefer to take less royalty and no post production expenses, particularly marketing, gathering and compression.... Companies are creating "gathering" systems and making contracts at outrageous prices, then selling these gathering systems to foreign investors. Then when prices are low, the entire royalty can be ate up by these contracts and Chesapeake, for one, has billed royalty owners for their "share" of this cost... IN OTHER WORDS, you are selling your gas for less than zero.
PS - that "gathering system" may be a 4" pipe running from the well head to the compressor 80 ' away and into the pipeline. Might cost $10,000 or less...sold with guaranteed contract of $1 per MCF or more...to carry it eighty feet...go figure.
Limit post production expenses, prefer to take less royalty and no post production expenses, particularly marketing, gathering and compression.... Companies are creating "gathering" systems and making contracts at outrageous prices, then selling these gathering systems to foreign investors. Then when prices are low, the entire royalty can be ate up by these contracts and Chesapeake, for one, has billed royalty owners for their "share" of this cost... IN OTHER WORDS, you are selling your gas for less than zero.
PS - that "gathering system" may be a 4" pipe running from the well head to the compressor 80 ' away and into the pipeline. Might cost $10,000 or less...sold with guaranteed contract of $1 per MCF or more...to carry it eighty feet...go figure.
I agree with Mr. Shields, once you agree to charges, you have no control over what they charge. The operator/lessee do not have to justify what you are charged because you agreed to it, it says so in the lease.
You are totally dependent on their mercy and when it comes to money they may not have any.
If it were between them losing money and you losing money...who would you pick?
Unfortunately as lessor you don't get to pick, but the operator /lessee do.
That area is bringing about 2k on a 1/5th royalty
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William:
You can likely get $3,000 and 1/5. Feel free to add me as a friend and I can give you more information.
Matt, would this location Section 17 Township 11 N, Range 5 W be same value? I appreciate your help. John
Ive seen some leases in your area going for a higher bonus with a 1/5th royalty. Will they offer a 1/5th royalty to you? You also need to get a debth clause and a no deductions clause put in the lease at the very least.
John:
I have not personally seen anything in that Township and Range, but it looks like it is on the outer bands of the play. It likely would be in the $2,000-$2,500 per acre price range.
They offered only $250. Plus 1/6 . I told them it was to low and he offered 3/16. Seems very low.
This helps a bunch. Would 1/5 be at this price? I appreciate your help. John
$2,000 at 1/5 or $2,500 at 3/16
Thanks for the info
All:
I sincerely appreciate your input on my request.
We negotiated $2,500 per acre, 1/5 royalty. No deductions.