Received a Lease offer for property we currently have producing wells on. The lease offer is for drilling deep under the Wolfcamp formation in which our current lease does not extend to that depth. This new lease is offered by a Mineral and Royalty acquisition company. Martin Co Texas, 3 yr term, 1/4 Royalty $3,000 NMA. Need advice.
I got this offer last August and was hesitant . From my understandingthere are 2-3 companies buying really deep leases.
Caroline.
Have an oil and gas attorney review the lease and facilitate the exchange of the signed lease to receive your lease bonus. Are your minerals in far north Martin county, near the Dawson county line? If so, could the Dean formation be of interest?
Are you sure they are offering a lease or are they offering to buy if you have 1/4 royalty? Some ‘royalty lease’ offers have onerous fine print which actually turn them into purchase offers. Do you have a depth clause on your current lease? Be cautious and get legal advice before signing anything.
Not sure about Martin County, but there is leasing for exploring the Woodford in other areas of Permian. That formation is below the Wolfcamp. As Martha recommends, read your paperwork carefully.