So what is happening in this area of Garvin County? Just when I thought all was dark and nothing was moving, we have an interest in our tracts in Section 03 and 09 in Township 02N-Range 03W.
I am under the impression there is a company interested in drilling below the formation we have leased and is also looking at other sections in Township 02N-Range 03W. Any insights will be helpful.
Castell and Warwick-Jupiter have filed cases or have some already heard in the southern portion of that township. Keep your ears open.
Castell and Warwick-Jupiter have filed cases or have some already heard in the southern portion of that township. Keep your ears open.
So, we have been offered $175 NMA for our Garvin County properties in Township 2 North-Range 3 West. I am guessing that given the current situation and lack of other companies expressing any interest in leasing any properties that this may not be “bad.” Anyone have opinion on that figure? They did want a 3+2 year lease which we declined after reading posts on this forum but have not heard back yet as to whether they will accept that. Of course we have not even seen their lease and terms so that might be where the real work begins. We will see how this goes over next few days.
For that price, I would wait for the pooling. At least you will get a shorter term under the pooling. Or if they don’t pool it, you get $0.
I hear what you are saying Frank. After thinking on this offer we came to similar conclusion. There has to be better terms and bonus even if it goes to pooling. Their lease would tie up about 15 properties with minimal bonus and they won’t back off the 3+2 lease. Think we will pass.
Never ever lease separate properties on the same lease. Always split them up. I personally would not do a 3+2 lease.
That is our decision also. Easy to get excited about a lease when there has been so little action lately but when we stepped back and looked at implications of such an arrangement it just is not worth it. Will wait for better deal. Thanks for you and Frank’s advice and support. The wisdom and experience of this forum pays great dividends. There is greater strength in numbers.
Sorry to ask. What is a 3+2 lease? Also, while on the subject of leases, would you do a well bore lease if you had a choice between a regular lease and a well-bore lease (all other things being equal)? I’m thinking about someone who got force pooled, but then it turned out they had force pooled it to someone who didn’t own the minerals. So when the mineral owner found it out and complained, the operator asked the real owner whether he wanted a well bore lease or the regular lease that had been “forced” upon the non-owner.
Three-year term with a first right of refusal to renew for an additional 2 years. Your scenario needs more information for a good answer.
Sounds like that person has a lot of bargaining power if they are an unleased mineral owner in a well.
Not really Rachel. The operator can pool the missed owner at market prices. Doubt the missed owner will choose to participate & the operator can pool the interest in a unit & not a well bore. Of course there is an advantage if it’s a good well & the mineral owner knows that information & has the gumption to participate.
So are you saying that if it’s a good well the non-owner ought to choose the well-bore lease over the unit lease?
I’ve been contacted on mineral interest in Section 3 and Section 7 of Township 02N Range 03W by Paladin Land Group of Tulsa wanting to lease below the Hutton formation. Offer is pretty low, so I was negotiating a better interest instead of the $100 to $125 they were offering, even then I’m gonna try for a one-year lease simply because of the offer.
Do you mean below the Hunton formation? If that is the case, don’t expect much in the way of bonus money as they are looking to explore very small pods, if you will, of oil formations. Get as much royalty as you can as it will pay off better if they do find hydrocarbons. Ask them who they are leasing for as they are not an exploration company, only a land company contracted to buy leases.
Yes Todd, below the Hutton, and being it is an exploration that’s why I’m pushing for a 1/4 interest and they have agreed so far. I know the area has good prospects, my lease above is the Floyd, north of the bottom hole is the Pacifico. So the possibilities of hitting a good pool is pretty good in this area of the tabletops.
There is no Hutton formation in Oklahoma. The Pacifico and Floyd are producing from formations above the Hunton. The formations below the Hunton are very small in geographical area. Make sure your lease has a Pugh clause. Good luck to you.
That same company approached us and offered $200 NMA with 1/5 royalty but would not budge on a 3+2 lease. We did not sign up. If you can get a one-year lease I will be surprised. We would reconsider if they offered that to us. Will be following this conversation closely. Good luck Randy.
Yes Todd the Hunton (correction apps!) all those posting be aware that when I strike the right deal I’m comfortable with I’ll post the results. I’ve got a couple of great land and mineral men I’m consulting with about this so thanks all around for all input. After all we must stick together against those corporates with the power of money always trying to gain from us. GBA
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