We recently received an unsolicited offer to lease the mineral rights on 80 acres in the SE/4 of Section 33 in Canadian County, OK The offer was from Chesapeake. Does anyone know if there are others actively looking to lease mineral rights in this area? Back in 2008 we were approached by a company that went under during the negotiations but was offering significantly more than what we are seeing today.
This is new so we are looking for guidance/suggestions.
Thanks
You might mention which township and range....
There are at least 3 companies doing a lot of the current leasing in Canadian County right now: Chesapeake, Sampson Resources, and Conquest Land Co (probably on behalf of some larger company).
In the past, Devon and Cimarex have done some leasing in the far western part of the county in the Woodford shale regions.
SE/4 of Section 33-14N-5W
Just in the last year, there have been hundreds of leases signed in 14N-5W. There are almost exclusively Chesapeake. Just a small handful were Chrisnik Energy and Continental.
Does that mean Chesspeake is the only offer or does it make sense to contact the others? We have not had any experience in this process.
Well, I would probably counter the Chesapeake offer and see how they respond. Usually, in this area, they will offer you a certain amount of bonus money (a few hundred $/acre) for the standard 3/16 lease. They will usually offer a lower bonus amount for a 1/5 royalty. And they might even offer a 1/4 royalty with no bonus or a minimal bonus. I would ask what bonus they offer for each of these royalties. Then, feel free to counter offer to them, and you will find out how bad they want it in your particular section. They may not negotiate at all, or they may show some interest. Once you get what you feel is their best offer, you can if you wish contact some of the other companies and see if they are interested. And before you sign anything, you need an addendum to your oil and gas lease that will give you certain protections that are always left out of the leases that they offer. You will find that discussed elsewhere on this forum.