Creek County, OK - Oil & Gas Discussion archives

Thanks Martha.

These are the leases I recently signed. Regrettably before I found this forum. I thought I would ad this info for reference.

Sec 3-15N-8E & Sec 25-15N-8E (Schonwald) Sec 33-16N-7E (Universal Land, Calyx) Sec 7-14N-8E (Abuelo)

Mark, what did you get for bonus in section 25 15N8E? If you don’t mind sharing.

Karla, it's 125.00 per net mineral acre. 3/16royalty. 3yr. with a 3yr. option

Like I said, I wish I had found this forum earlier than I did.

Thanks Mark.

We are looking at 250/acre and 3/16th.

I am being offered 250.00 per acre 3/16, 3yr with 3 yr option In 5-14N-8E.

I was just getting ready to sign it and mail it back but now I am leery because of the Warrent clause and seems like a perpetual lease after the 3 year option if they don't drill for annual payment of $1.

Rob, do not sign that. You DO NOT want a 3 year option. You probably do not want some of the other clauses on that lease either. Friend me if you want me to walk you through it.

Martha, my mother in law just got offered similar terms as Rob. I would love to talk to you more about this offer. it is Schonwald land. Do they represent Marathon?

Martha, I emailed you on the 13th but I did not hear from you.

I received a lease from Schonwald Land. I compared it with the standard OK paid-up lease and found the differences and the wording added. I ended up calling the Ok Corporation Commission and they explained exactly what every clause I questioned meant. Schonwald added clauses to the lease that extend the primary term from 3 to 5years. Furthermore, Schonwald errorneously described the acres involved as 10, when it should have been 80 (I own 10 undivided acres of the 80). Schonwald agreed to correct the error, but would not negotiate any further. Schonwald cannot tell me who their client is, but they are pooling the land (640 acres). According to the OK Corp, this implies vertical drilling is contemplated.

I will not sign Schonwald's lease, unless extensive changes are made. I hope my findings will alert others to be very careful before they sign a lease.

Hilda, sorry, checked, but didn't see an email in Nov. Last one was in Oct.

You are correct. You don't want the extension. Actually, if you have 10 undivided acres of 80, you only have 10. It just means that you have 10 of the 80 with no specific placement of the 10. Any well in that 80 would give you revenue if it was a vertical well drilled in the 80. ("Divided" would assign you a particular spot in the 80), However at 640 spacing, it doesn't matter. You would have royalties based upon the 10/640 *X royalty rate (3/16th, etc). 640 actually implies that either a vertical gas well is contemplated or a horizontal. I am surprised they didn't tell you that.

At this point, you can wait for force pooling which will limit the lease to either 180 days or 365 days or you can negotiate some more. Good for you to try to understand all the clauses.

Hilda, what section are they pooling? They have also contacted us.

Karla, I am in Section 21. I do not know what other sections may be pooled. According to OK Corp., nothing has been filed with them (no permits, no spacing.)

Martha, I thought it might make a difference in how the property was described in the lease. I thought that if the lease indicated10 acres, the royalties would be based on what was produced on only a specific 10 acres. By properly indicating 80 acres, royalties would be based on1/8 th of what is produced on all 80 acres. The royalties may amount to be the same either way, however, I found it strange that the lease did not indicate the proper and legal description of the property.

Martha, thank you for helping me sort things out. I will let you know what happens with Schonwald.

Karla, a lease must accurately describe the acreage or it will cause huge problems. I see what you are saying. In this case, at 640 acre spacing it doesn't really matter. The "undivided" words mean that you have 10 acres "spread out" over the 80 acres. So if they drill anywhere (vertical) in that 80 acres and it is spaced at the 80 or even a 40 or smaller, you get paid. If you have a "divided" portion, then it means you have a very specific piece of that 80 acres and only get paid if the spacing includes your exact 10 acres. See if you can find out who they Schonwald are leasing for. If it is who I think it is, you probably better off getting pooled. Don't go with their lease if you can't get the right clauses.

I'll send you my email again.

Schonwald will not disclose their “client” I have signed 7 leases with them. I wish I had read this forum in advance. I don’t think I can get out of the leases now.

Jodie, you cannot get out of your leases.

For those of you interested in what is lying under Creek County (or if you have insomnia) here are some articles, some old and some new to get your self oriented with the history and geology of the area. It doesn't paste very nicely, but you can copy the links. Let me know if it doesn't work.

Geology of Creek County http://www.ogs.ou.edu/pubsscanned/BULLETINS/Bulletin81.pdf
Mississippi Lime http://oilindependents.org/the-mississippian-lime-not-new-but-reinvented/
Geology of Creek County http://luna.library.okstate.edu:8180/luna/servlet/detail/OSULibraryOCM~7~7~44359~113047:Geologic-Map-of-Creek-County,-Oklah
Cushing Field Creek County http://digital.library.okstate.edu/encyclopedia/entries/C/CU008.html
Oil & Gas in Creek County OK http://www.ogs.ou.edu/pubsscanned/BULLETIN_40/Bulletin40_Cmm.pdf
History of Cushing Field http://www.okhistory.org/shpo/thematic/cushingoilfield.pdf
Cherokee Platform Province http://certmapper.cr.usgs.gov/data/noga95/prov60/text/prov60.pdf

Thank you Martha. This information will be a real eye opener. Just a quick skim of the history alone is a mind blower.

I agree! Thank you for sharing.

Received offer to lease. It said lease/assign and pick one of three options. The assign was confusing. Don’t want to participate. Is this normal language?