Barnett Lease Extension

Hi all,

I'm an independent landman (2+ years now!) and a mineral owner with a lease. I'm familiar with many aspects of researching title and leasing minerals, but not how the operators work. I'm new new to this forum and it looks like a good place for some general information on minerals and how the industry works.

As part of a large neighborhood association in Arlington, TX, I signed a a 3 year lease with 2 year option in January, 2007. Three years passed this January and, to my knowledge, there has been no well drilled which would service my neighborhood. In February, my next door neighbor received a lease extension bonus check (part of the original lease negotiations) and I have heard of others in the area receiving the same, but I and most of the neighbors I have talked with have not received anything. Is this unusual? It seems to me tht if the lessor is going to extend one lease in the area, they would extend everyone. Anybody have any ideas?


I would think that you and your neighbors will be hearing from this company in regards to a lease extension. I have no idea the amount of acreage you are talking about or the vicinity where the individuals are getting this extension offer but I have heard that some companies are having a difficult time with the city of Arlington's restrictions in regards to drilling acitivities. Again, there must be some underlying reason if you and your neighbors are not contacted.

Did he lease for alot less than everyone else?

David: Your mineral lease should tell you the nature of the terms you negotiated as it applies to an option to extend. I signed a lease with this provision and my lease stipulated that in order for the option to extend to be exercised the “option” bonus payment must be made prior to the lease expiration date. This was done in my case. If the primary term of the lease expires and the Operator chose not to exercise the option to extend, by paying the option bonus, then you are free to lease to another Company. Perhaps you might contact the lessee and get an explanation.

My neighbor signed at the same "leasing party" as most of the several hundred other home owners (this is a suburban area with lot sizes averaging a quarter acre or so). My question is not so much are they going to extend the leases, but why are they extending only a small number? It seems to me if they extend my next door neighbor's lease, and assuming I would be on the same well bore path, then they would extend mine and others' too.

Also, my neighbor received his renewal check several weeks after the primary term had expired. I don't think there was any specific wording in the lease as to the timing of extensions. I know that I am technically free to lease to another company at this point, but I don't know if there is any real interest in light of current gas prices. In any event, an extension would be far more attractive (at approx. $17k per acre) than the current offers in the Barnett at less than $5k/acre.

R W,

On that note, I have spoken with a few of my neighbors that leased early and for quite a bit less per acre. They have not received extensions either although they may not have had an option in their original lease.

r w kennedy said:
Did he lease for alot less than everyone else?