33 & 34 1N1W Garvin Recent offers

Getting a lot of interest in the last 3 weeks. Best purchase offer was $10K/NMA and the best leasing offer was $1750/NMA for 3/16 - 3 year with 2 year ext option. Anyone else getting any offers around these sections?

From what I hear, that is in the ballpark. Although, I anticipate they will go up to 20% royalty. FWIW, I have heard of company landmen having a different lease broker to call you with a much lower offer. The idea is to make you think the $1,750 & 3/16th is a really good deal.

I always ask for the 1/5th and 1/4th option. 3/16ths is my low end. The bonus will be less at the higher royalties, but usually, in the long run, higher royalties trump a one time bonus. I never do a two-year option.

Ask who they are leasing for. Continental is buying up acreage in their plays and reporting in their investor presentation that they will make about four times as much on it. That tells you they are lowballing the offers.

If you lease, be sure you negotiate the terms of the lease to be more in your favor. The draft lease usually is all in the company’s favor.

Right now Continental has the highest offer. Although a broker for Alphabet was going to call back and see if they would beat Continental’s last offer. We wouldn’t consider selling, its been in my family for 75 years.

Don’t lease for less that 25% royalty. Never sell out. I would not lease for less that 3K/ac and give a 2 year lease with a 2 year extension for the same per acre price. If they push real hard give them 3 with a 1 year kicker, for the same price, yes for the same price. (nets 4 years at 6K/acre) I have small minerals north of you (2N 1W, 2N 1E) but they are leased. An old lease, not a good lease. I believe we are east of the real play but it is good to see the action.

I would sure like to know whom offered $10K/ac.

10K Was offered by Bunker Oil to purchase, Antelope just came back and said they could get to $7500 Per NMA but they couldn’t afford to buy more than a few acres. I have been told that they are getting ready to pool this area, hence the onslaught of offers to purchase and lease. Can’t get 25% and any decent money. currently at $1750 and 20% and negotiating the exhibit A. They don’t like my no deducts clause but we consider that non-negotiable.

This area is a small geographic window of gas with condensate in the Woodford. May be faulted, so complicates things and decreases the leasing bonus amount and royalty percents due to the risk.

Given that Continental is most likely going to be the operator, getting a no post production lease can require some negotiation.