We have mineral rights in Section 7 1N 4W in Stephens county. Does anyone have any information regarding new well permits for that area?
No applications or permits currently.
Thanks Rick. I am having a very hard time making the decision on whether to go with the higher lease bonus or the higher oil royalty. They are offering $2,200 per acre bonus and we have about 15 acres. That is a nice chunk of change to have handed to you. I wish there was a magic ball that would tell you what to do.
Lora
Rick Howell said:
No applications or permits currently.
Lora,
Don't think of a "nice chunk of change being handed to you" but what that payment takes away from you in the future. My "magic ball" tells me you and your heirs will give up over $3000/acre/ well for every 1/8 royalty you give up now in 2014 dollars and that is without income tax considerations. 6+ wells in a section represents a lot of future income. My estimate assumes you deal with a proven operator in a timeframe that reflects development in your area. Your personal needs are of the upmost importance in your decision so don't treat the offer as a gift but as what could be the last lease you be offered. The new world of horizontal drilling technology takes this out of the "business as usual" category. Your 15 acres is in a very good area geologically. Continental, Marathon, and Newfield are not there by accident.
Lora Goldston said:
Thanks Rick. I am having a very hard time making the decision on whether to go with the higher lease bonus or the higher oil royalty. They are offering $2,200 per acre bonus and we have about 15 acres. That is a nice chunk of change to have handed to you. I wish there was a magic ball that would tell you what to do.
Lora
Rick Howell said:No applications or permits currently.