Extended Leases and Bonuses

I recently received an offer to extend a Lease in Weld County, CO. The Bonus is very low and they want a 5 yr lease with possible 3 year extension. Has anyone else heard of this long of a lease and does anyone have a Bonus Offer they can share? Thanks for any insight/help you can give me.

In the new oil business, Weld county is becoming more of a mining based operation. High capital costs, long lived reserves, cost efficient operations. The risk of finding oil is near zero due to fracking and horizontal drilling technology. As a mineral owner you must adapt your expectations to the new oil production economy and demand lease terms that reflect the long term geologic potential of your property. Owners should know what the quantity and quality of proven, possible, and probable resources (inventories ) are for their land in order to strike fair deals.

Gary L Hutchinson

Minerals Managment


We are in 7N60W S14 and 15 and had a low offer that we let lapse. I'm curious what your offer was. I'll send a friend request.

Rachel Potter

Only $100 per NMA and 3/16 Royalty. N B Mitchel

We are in 7N60W S14 and 15. 480 net acres for whole family, though I've only got a fraction of that. We had an offer from Caerus for 3+3, 18.75% royalty, $125 per net mineral acre, for the initial three years, and $150 per net mineral acre extension. I understand that rates have been much higher to the SW of us. We let the offer go. Still waiting.

I own a small fractionalized MI. However, it has leased in the recent past for 3/16 and 3 yr 2yr extension with.a $340 bonus per NMA. Prior to that, it leased for 3/16 and a $225 bonus per NMA.


One potential source of some information is from forced pooling notices in nearby Townships. You can find this information on the Colorado Oil and Gas Commission website - Township & Range.

Another source of current rates is the Lierle Price Report (although you must take it with a grain of salt since offers vary by exact location) showed lease terms between 1.5 - 5 years and average lease bonus of $300/NMA (NW Weld was lower at $20/NMA but I'm not sure I'd put stock in that number).

Here's a checklist you can use that has some other things to consider. As with any business transaction, be sure to cover your bases and get help if you aren't comfortable negotiating the deal. Also, don't be pressured by tactics that threaten that the offer is only good for a limited time.

Thanks so much. So hard to get info on current leasing, other than it’s low.


Matt: Good info in the PDF. Thanks. With just a a quick look, I already have a question: We have 2 non-contiguous tracts. The last landman I was in touch with insisted the Pugh clause negated the need for 2 separate leases. What advantage is two leases if we have a Pugh clause?



First, let me say that I am and Engineer not a Landman so this is not my area of expertise. That said, from what I've read, I would tend to agree with the landman you spoke with. In terms of having two leases, if you can shop around and get a better offer for the tract in a better area (higher bonus, higher royalty, shorter term, etc.), then it might be worthwhile to lease the parcels separately.

At the end of the day, it sounds like you have your bases covered in terms of ensuring that the production from a pooled unit in the first tract won't hold the portion of the lease covering the second tract. Be sure to consult a professional to review the specific language in the lease because not all Pugh clauses are created equal.

I'd be interested in what some of the land experts have to say. Anyone?


Two leases act as a natural firewall against the possibility of inadequate language in a single lease. There is also always the possibility that how language is construed can change. Having 2 leases should add minimal cost to the deal.