My O & G lease is due to expire in the next several months and I've been contacted by the Lessee (ETX Energy formerly NGR) to enter into a new lease agreement. They offered 20% royalty and $450 to $500 bonus per acre. NGR recently had seismic performed on all property in the area. For them to want to renew and extend leases in our area tells me they saw something they liked. Has anyone else been contacted?
We have been contacted to lease our O&G rights by Acaval Land Company. Offering $250 per mineral acre for a three year lease, 20% royalty. Our mineral holdings are 1.5 miles north of Shiro. Any comments as to the worth of the lease over this term would be appreciated. Thank you.
Tom,
We need to know the exact location of your minerals acreage. Can you supply the Section and Block #. The person helping you can check for activity and production in the area. Exact location can make a big difference.
Thanks,
Clint Liles
A-39, 10A, 10B, 10C, 10D, 11, 12
Tom,
I see where numerous sections in Grimes County only have Abstract numbers assigned to them. Do you have an Abstract number?
Clint Liles
Tom,
Back in 1996-1998 Sonat Exploration(Tyler, Texas) and Chesapeake drilled several gas wells in this area into the Austin Chalk formation. Most of these wells are still producing small amounts of gas even after producing for 20 years. In A-39 Sonat drilled gas well 30604(((( http://webapps.rrc.state.tx.us/DP/publicQuerySearchAction.do?countyCode=185&apiSeqNo=30604 and had an approved permit for well 30611 but never drilled it. Sonat Exploration has now changed their name to Tanos Exploration by turning the name around backwards. They are now drilling some fantastic gas wells in Smith, Cherokee, Rusk, Gregg, and Panola Counties.
In 2008 Southern Bay Operating drilled numerous gas wells to the South and Southeast of A-39. There are some decent gas wells in this area. Acaval Land Company I am not familiar with. Since there is production in the area you might try for a little more bonus money. The 20% and 3 year lease sound OK. One of the main items in your lease must be definitely no deductions for processing, gathering, treating, compressing, dehydrating, transporting, and marketing or otherwise making such gas or other substance ready for sale.
GIS Map of Grimes County A-39:
Clint liles
Thank you sir for the information. I will try to locate abstract numbers on the mineral right docs.
The area of our acreage is bordered by the A-11 line to the north, CR 229 to the east, and the RR track to the south.
Tom,
From your description your Abstract # will be A-39.
Clint Liles
Anyone familiar with M.D. America drilling in Grimes county
Julie,
I this the company you are interested in:
MD America Energy LLC-Ft. Worth, Texas
817)288-7800
http://www.texas-drilling.com/operators/md-america-energy-llc/556481
Clint Liles
I have an extended lease with them
I have received an offer from Acaval Land Company to purchase a oil and gas lease covering property in Grimes County. The offer is $250 per net mineral acre for 3 years with 20% oil and gas lease royalty and 3 year extension bonus. All I have is the information on the letter which states W. Berryman Survey, Abstract No. 83, Grimes County. Trying to find out if $250. an acre is a reasonable offer and if anyone else has received offers in this area. Thank you!!
Diane, did you happen to ask Acaval who they are leasing for? ETX Energy recently offered me $450 per acre and 20% royalty to renew my lease I currently have with them. I told them I'm interested in another lease but not at those prices. I want 25% royalty and a higher dollar amount for the bonus. I haven't heard back from them but that's okay. Some of my neighbors are leased with Apache and their leases begin expiring later this summer. I'm sure Apache will be contacting me around that time. If not them, someone else. The money is nice but leasing your land can be a pain if you don't have the right lease.
Thank you Captain Skittles for the information. I will call and find out. I'm not sure where this property is. Would I have to go to the Grimes County Appraisal District to find out and would they let me know since I am only a mineral rights owner? These mineral rights have been in our family since the early 1900's so those that knew are no longer with us. Again, thank you!
Thank you Clint! That's is so helpful!
Captain Skittles or anyone else,
We have received a similar offer to yours:
$450.00 per acre for a three (3) year term with a three (3) year extension, and a 3/16th royalty
OR
$425.00 per acre for a three (3) year term with a three (3) year extension, and a 1/5th royalty
And have a similarly structured leases in the past. But we have never ever received a royalty check from New Gulf. Can you tell me when you get yours, how often, etc.? You seemed to want to negotiate for a larger royalty percentage than price per acre, which made me curious. Can you help me out?
Thanks!
Kathy Sawyer
Kathy:
We were leased with New Gulf Resources now ETX Energy for 3 years with no extension. Our lease was up the end of May. Since they didn't drill there was no royalty paid. We received just the one-time bonus amount when we leased initially 3 years ago.
Insofar as re-leasing with them I told them I wouldn't lease unless I received 25% royalty which is what we had in our last lease with them. They didn't seem to be interested. I realize the price of oil is down but I cannot see agreeing to less than 25% and I'm quite surprised there are some folks in the forum recommending people go with 20% or less. I, personally, would not lock myself in with that rate in the event they punch a well then I'm stuck forever even when oil goes back up one day. I guess it just depends on how bad you want or need the money. Regarding the bonus amount, we got almost triple the amount they are offering now so again, I'm going to be hard pressed to go that low with them. It's a personal choice for people and they need to think long and hard about it.
I do know ETX Energy is leasing heavily in the Bedias/Iola area (Check out Texasfile.com) With the seismic testing they did about 2 1/2 years ago it seems this area had some good results. Why else would they be renewing leases in this entire area?
Hope I've answered your questions. If not let me know.
Thanks so much!