Does anyone have any information on Compass Land Resources or Circle 9 Resources? I just received a proposal letter from Compass Land Resources asking me to lease my mineral interests to Circle 9 Resources for the purpose of drilling a test well.
Also, what is a reasonable offer on this section? Seems to me the proposal is unusually low and for an unusually longer time period. Here are the details:
1. 1/8 royalty, bonus of $125 nma for a 3 year term with a 2 year extension option
2. 3/16 royalty, bonus of $75 nma for a 3 year term with a 2 year extension option
3. Participation on a per-share basis
I am not inclined to accept such a long-term offer for a test well. Thoughts?