Sec 32 Blk 30 T-1-N, 136 ac - We were just offered a $30,000 bonus, 20% royalty. We are being told drilling will start this fall. Of course, no guarantee. Our last lease was significantly higher at $800/nma. Should we be asking for more? Any other insight you want to volunteer would be appreciated.
Not sure about the bonus but I think $500/nma is reasonable ($30,000 equates to about $221/nma). Don’t take less than 25% royalty. I don’t know the geology in this area.
We have some interests in the area. May ask who made the OGL offer?
Longboat Energy Partners
Thanks Jerry. I will keep you in the loop if I get additional information.
Thanks! I appreciate it.
Our system is showing ~$700/ac for a 25% would be the max I’d expect, but it’s also a bear oil market since early April’s OPEC+ and tariff fun, and people are less willing to stick their neck out right now. It’s also right on the edge of development, so it’s the first of the areas to feel the contraction when there’s any negative sentiment on oil.
I’d recommend holding out for 25% in this area, if you can afford to. Even with the bear market it’s still a great area that keeps on giving. It’s the best way to set yourself up for future success since that lease royalty can hang around for decades after a well is drilled. 20% rather than 25% could end up being massive, especially if prices go up, and should be considered just like if you were “selling” 1/5 of your interest in the property. There’s certainly a time to sell and diversify, but a 3 year low on oil prices probably isn’t when I’d lock in any values unless I had to for financial considerations.
What did they say when you countered? I’ve never heard of this company and they could just be lease flippers.
I have made no counter yet. Can anyone tell me if there have been any permits to drill in this area?
You may easily see all permitted wells on the TRRC website, just open the GIS viewer and move it to your area of interest. As easy as pie!
Hello. I’m not having any luck. Taking me to TX site.
This will open the RRC map viewer on a well in your section. Note there is existing hz production to your east. https://gis.rrc.texas.gov/GISViewer/index.html?api=22732117
This will open the RRC map viewer on a well in your section. Note there is existing hz production to your east. https://gis.rrc.texas.gov/GISViewer/index.html?api=22732117
Not sure what you mean by HZ production?
Production from horizontal oil wells.