I received a lease offer today for my minerals in Sec.6-6N-5W and Sec.7-6N-5W in Grady Co. Okla. The offer was $2,500 an acre and a fifth royalty. I was wondering if this is a good offer:
Welcome to the forum. Are you already getting paid on the Continental horizontals that are already there? Is this an offer for a different reservoir? A bit confused…
I’m receiving income from the Wheeler 1, 3, 4 and 5 wells in the Woodford formation, as well as the Tidua in the Mississippi formation. Continental is planning to drill a well into the Springer formation.
I always like the 1/5th or higher royalties. Was the letter the one that offers a working interest or the options to lease? Sometimes, those go out to folks that are already leased because they are wanting more working interest owners to help fund the new well. If you were pooled at the deeper horizons, then you may be open to lease at the Springer level. Cannot comment on the bonus as those amounts are not public.
The clauses in the lease are critical. It would be wise to get a good oil and gas attorney to review any draft lease to protect you against post production charges. Or you can wait for the pooling and select a bonus/royalty pair then. Only 20 days in which to answer the pooling order.