Gary, Thanks so much for such a detailed comment, you definitely have a deep knowledge of the workings of these kind of situations.
Do you think if the big pipeline thing goes through that anything in the Montana area will move along quicker? I had thought that maybe Apache was waiting for a cheaper way to get the oil out of Montana.
Again, thanks for sharing your knowledge with us.
Gary, I too want to thank you. I think we’re all very lucky to have people like you who know so much about this. Heaven knows…I sure don’t. I keep hoping I’ll live long enough to see my mineral rights produce but after last summer and fall, I’m not sure that will happen. Fingers crossed!! Thanks again.
These comment are in regard to Sheri Olson comments, the “Gasland” documentary video, and environmental and health related issues with oil and gas drilling. For those people who are negatively impacted in this way with environmental contamination, it is obviously devastating. My question, however, is what percentage of the wells contribute to this kind of environmental contamination? Is it 0.001 %, 0.01 %, 0.1 %, 1 %, 10 %, 50 %, 80 %, or ??? of the wells. If it is a large percent, a majority, or a very large percent, like 80 or 90 %, there is no way it would be allowed to continue. In this day and age of rapid communication, social media, blogs, Twitter, and etc, if there were a large percentage of wells that are contaminating the environment and causing health problems, people would be joining FaceBook groups, blogs, Twitter groups in droves to complain and shut down the practice.
On the other hand, feedback to me from people who are knowledgeable about drilling indicate that there are marginal drilling companies that employ marginal drilling practices that contribute to these contamination incidences but that good drilling companies that employ good drilling practices, do not contribute to these types of environmental contaminations and that the percentage of failure is low. For some, however, any percentage over 0 % is not acceptable and from a human, animal, environmental point of view, that is probably true. However, where there is money to be made and a national energy supply is in question, a certain failure rate is probably considered to be acceptable. I think, however, those companies that are responsible for environmental contamination should be fined severely and have to rectify damages at say quadruple the damages and that would help to rid the system of bad companies with bad practices.
Deciding not to lease your land will not prevent drilling. If you are a minority owner in a section of land, drilling may proceed providing you in the end with the average going royalty rate on your section. If you do not want to accept the money, it goes into an escrow account for 7 years and then goes to the state, if not claimed. If you own majority or all mineral rights in a section or sections of land, drilling will proceed around you and you will only loss out because your oil will be drained off in other wells.
If there is great enough concerns about environmental and health related issues about oil and gas drilling, join FaceBook groups, blogs, or other movement groups to pressure elected officials for greater oversight and statistics and penalties for environmental contamination. I believe the fact that this has not happened, indicates that the failure rate is not high enough to bring enough pressure to alter or stop the practice.
The Viking…Great intelligent reply.
I keep saying this and I’ll say it again. When Bedingfield was asked about the Lindley well near 4 Buttes he said, “we are very pleased with the oil shows in the first well.” Apache will be back in Daniels county. They have simply put it on pause. IMHO
Gary, here is the description.
36 North, Range 48East
Section 19: SE1/4NE1/4, E1/2SE1/4, SW1/4SE1/4
20: SW1/4, S1/2N1/2, N1/2SE1/4
29: NW1/2NW1/4, SW1/4NW1/4, SE1/4NW1/4
30: Lots 3(34.01), 4(34.06), E1/2SW1/4, E1/2
31:Lots 1(34.11), 2(34.18), E1/2NW1/4, NE1/4, Exception there from that certain Triangular Tractor parcel of land containing 67.97 acres located in section 31described as follows: Beginning at a point 346 feet south of the corner post at the Northwest corner of section31 township36 North Range 48 East Montana meridian, thence south 2298 feet along the section line to the corner post of the Southwest corner of the Northwest Quarter of said Section 31, thence East 2577 feet along the quarter line, thence in a straight line in a Northwesterly direction to the point of the beginning.
Containing 1428 Gross acres more or less
My brother received a letter from Aurora Energy Solutions LLC saying they are will ing to purchase his “Production Royalty Interest” while he can retain the mineral rights. Apparently the company is representing landman making deals.
None of the rest of the family has received letters. What does anyone know about this tactic?
Thanks Bonnie. Just curious why you didn’t call if you don’t mind answering? Avoid a hassle? From what I am finding online ( not much and nothing in depth) it’s a very confusing decision to make and some say to hire a lawyer and someone to assess mineral value. An assessment sounds like a can of worms in a way. How can anyone know what lies below our properties?
I think I need to do more homework on this letter. My brother was the only one from our family so far getting a letter. He is sending a pdf to me tonight. We have a similar number of inheritors in our family.
My banker son-in-law is here for the holidays and we stayed up late the other night discussing the Production Royalty Interest idea. We are both thinking it’s a business decision by Shale or Apache or whoever owns the drilling rights to buy back some of the potential royalties they might eventually pay out.
So do they know something we don’t? That’s something that should be researched and if the answer is yes that there is gas or oil then I would not sell for anything. It wouldn’t make sense the way I see it now loosing potential income.
Anyway that’s our conjecture.
I received the same letter. Thought it a scam as it didn’t reference any particular property, etc. They are a legit company I think, as I looked them up on Google. I was going to call them, but decided against it.
First of all I didn’t answer because I’m the only one of 9 inheritors on the same properties that received the letter, secondly, by signing the letter and sending it back there was no clear property (all, part, what?) it referenced, and thirdly I’m not currently getting royalties off my mineral rights…so what do they think they are referencing? Just seemed too shysterly. I agree, other an a presence…not too much information on google.
Assessments: In Golden Colorado here is an entire university dedicated to finding, removing, and processing minerals at a profit for use by the populations of the world. This school has been turning out people to assess minerals and manage successful companies since 1874. There are similar institutions in Montana, Nevada, Oklahoma, New Mexico, Pennsylvania, and Texas to name a few… Scientifically based assessments are more than a can of worms; they are the foundations of sound decision making.
Production Royalty Interests are derivatives. If you like and understand financial derivatives, you will love Production Royalty Interests. The buyers already have an assessment of you land potential and are willing to purchase a derivative from you for their benefit in the future in exchange for cash benefit to you now.
Questions, do PRI survive the expiration of the current lease so you only get the bonus from a new lease? If you are HBP, does the RPI go to all new discovered formations? If the buyer of a PRI goes into bankruptcy, do you get your asset back? Do the think the buyer has adequately risked the price paid to the future potential? If you owned a bond and sold the stream of future interest payments, would the stripped bond be worth much when interest rates went down? And on and on.
Profitably Managing minerals involves much more than arithmetic applied to bonus per acre offered and royalty rate offered. Understand what you are really selling before signing a contract.
Wow, Gary, I’m not sure what all you said, but I am sure I don’t know much about what I have.
If you google on Aurora Energy Solutions, you can get to web directory listings that provide an email contact for brentbrannan@gmail.com. If you google on Brent Brannan, you get perhaps useful search results including an interview with possibly same Mr. Brannan at this web address:
3 year lease is up. Will apache renew my lease?
Timothy If they do contact you to lease again, it might be prudent to think that with the New Oil Prices, they might try to low ball you. good luck. Brian…
Does anyone know if Shale Petroleum is renewing leases in Daniel County, Montana? It is a 5 year lease and ends Feb. 2017. How do I find out if they will be renewing and how far before the deadline should I contact Shale Petroleum?
Anyone have a lease coming up for renewal in Daniels County this year? Any activity at all? I signed with Shale Exploration three years ago. Renewal is this July if they want it. I’ve heard nothing.
Does anyone know how to reach Shale Exploration in Texas? I’ve tried calling them several times and no one gets back to me. It’s regarding an oil and gas lease in Daniels County. thanks
Sandra: I have been away from this site for a couple years, but I recall Shale Sold @ 300,000 acres of leases to Apache Petroleum. You can call the clerk’s office in Daniels County, and they can tell you who owns the leases. Shale will not return any phone calls. Weed