Downside to not leasing?

What are the downsides of not leasing prior to drilling other than missing out on the Bonus. Is there a a chance that the royalty will be lower than 3/16ths if the section is force pooled?

Forced pooling usually has a selection of options which are supposed to be the equivalent of the best offers that the operator has made in the section and the eight surrounding sections in the last year. So usually, there is a bonus with at least one of them. I see leases filed for 1/8th, 3/16ths, 1/5th, 22% and 1/4th, so you are likely to see a subset of those on the pooling. At this time, no pooling case is posted.

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some get more than a 1/4 on these directional , I have been told this, I will not lease for less Than a quarter

My issue with being pooled is that, without a lease, the operator is free to rake our portion of the proceeds for deductions to their hearts’ content. We’ve had as much as 52% taken in deductions in the past on a force-pooled property. :rage:

There is a variety of opinions on the deductions by pooling. In the past, all poolings were gross with the only deductions allowed as taxes which everyone has to pay. Some are more aggressive in their wording and try to get away with more post production charges. Some attorneys are of the opinion that poolings are still a gross payment (except for taxes) with no PPC allowed. Others think they must abide by the terms of the Mittelstaedt case.

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