Received offer for an oil and gas lease (for Section 31 Township 6N Range 7W) from Calvin Energy, LLC. for $225.00 per net mineral acre. Five-year primary term and a royalty share of 3/16. Is this offer too low? Will appreciate any advice.
First of all Charles welcome to the forum. I would suggest you go up under groups and go to and join the Grady County Forum were you will find a very active group and by reading the comment wall and discussions in that group will learn what is happening in the area and someone will answer most of the questions you may have. My opinon is that 5 year term is a big No,3 years in the normal term. I will try and check what the bonus price is for your area it varies in certain parts of the county.
Richard -- thanks much for your prompt reply and for welcoming me to the discussion group. I thought I had successfully signed onto the Grady County discussion group, but perhaps I didn't do this correctly. It was useful to learn that a three-year lease is more appropriate than a five-year lease: the former lease held on the property was originally for three years and had been in effect for quite a few years, apparently as a result of continued production from the property. Do you by any chance know how one locates a copy of the mineral deed for a particular property? The lease in question has been passed along through inheritances, but I am not in possession of an actual deed. I have been in touch with the Grady County Clerk, and have not been able to locate such a document. Again, thanks for your input.
Richard Pruitt said:
First of all Charles welcome to the forum. I would suggest you go up under groups and go to and join the Grady County Forum were you will find a very active group and by reading the comment wall and discussions in that group will learn what is happening in the area and someone will answer most of the questions you may have. My opinon is that 5 year term is a big No,3 years in the normal term. I will try and check what the bonus price is for your area it varies in certain parts of the county.
Charles,
The name Calvin has started coming up on these forums recently and it seems they are speculating on future development and making some pretty low offers. Personally I think $225 is ridiculously low. I checked your area and didn't find much activity, so unless you just need the money you might want to hold off and see how things progress. No leases have been recorded in your section in recent years so it looks like no one has taken the bait yet. In other sections in your township a company named Unit Petroleum seems to be the dominate player.
If you don't have enough information to order a copy of the deed over the phone it could require a trip to the clerks office to look it up. If you are unable to do that you might have to hire a Landman to do it for you. If Calvin was able to find it it's on file somewhere. Here is a link to a county clerk website. Enter what info. you have and maybe something will come up http://okcountyrecords.com/search.php?county=026
I agree with Richard, don't get stuck with a 5 year lease, five years from now it could be worth 10 X that. The next time you are on the Grady forum be sure to click "follow discussion". Good Luck!