Brazos county royalty rate and bonus

Halcon sold all of their East Texas oil and gas leases to Hawkwood for 500 million. Brazos county was included in the sale. Does anyone know what the prevailing lease bonus and royalty rate is now for Brazos county. The University of Texas has a 25% royalty on all of their leases for 2017. Bonus rates vary. I am interested in bonus amounts for developmental horizontal wells around the Jones production unit.

O&G potential across Brazos County varies so bonuses will vary based on location of the minerals in the county.

The less prospective areas will have bonuses of less than $500 per net mineral acre. Not sure what the high side range is but Eagle Ford variability will impact that number too

10% of this lease is held by production with 2 Horizontal wells. The other 90% expires this year. Hawkwood bought the lease in the Halcon's package mentioned above. Halcon had already done the title work to form the Tuna and Mackerel production units before the sale. The 90% portion of the lease set to expire this year would be included in the Tuna and Mackerel units. Hawkwood sent me a low ball renewal offer that was so low that I did not even bother to counter. I have received multiple offers, so far, all of which are in excess of Hawkwoods offer. I received $600 per acre from Halcon in 2012 for 3 years with an additional $600 if Halcon exercised a 2 year option. So, I received $1,200 per acre for a 5 year lease from Halcon starting 2012 for an exploratory prospect. The Jones 1H and Jones 2H are holding the 10% portion of this lease. Halcon proposed to drill 6 additional horizontal wells adjacent to this lease and include all of my acreage in the two production units they were forming. Halcon filed chapter 11 and subsequently sold all of their Ease Texas oil and gas leases to raise money and pay creditors. I am being advised not to renew with Hawkwood and let the lease expire thereby allowing the industry an opportunity to acquire this lease at market value.

Sure looks like rejecting Hawkwood and waiting for better offer is the right move. But I bet you Hawkwood steps up with higher bonus prior to expiration.

Or they will rush out and start operations to hold the leases under present terms / lease.

I just looked up the production and location of the two Jones wells you mention. Good area in the Eagle Ford trend as to GOR and potential per well recoveries.

Does your lease consider new location work as "starting operations"? Or does there need to be a rig on location drilling to be considered "operating" over expiration date?

Definition of operations: drilling, testing, completing, marketing, re-completing, deepening, plugging back or repairing a well in search for or in an endeavor to obtain production of oil and gas or other minerals.

And as long as "drilling" does not include location prep, you at least force them to put a rig on location. Of course, the rig may only be a spudder rig to set surface casing.

Thanks for the info

Thank you. Very helpful information. You can read the Hawkwood press release they made in January 2017 concerning the purchase of Halcon's properties. The sale closed March 9, 2017. $500 million price. 81,000 net acres. 9,200 Boe/D production. 170 wells. Hawkwood is a small company. This is a large purchase for them. I'm sure that they are swamped trying to figure out what they bought. I am also certain that I know more about my lease than they do at this point. I am willing to give them a chance to learn the market and chalk up the first offer to ignorance. We'll see...