My aunt and her family have around 640 mineral acres near Plentywood Montana. This is in the bakken area. It is a few miles across the ND boarder. And about 40 miles away from land I have in ND That leased for $500 an acre and 18.75% royalties. My aunt has not had the minerals leased in several years. She just got a letter a couple weeks ago with an offer for $10 per acre and 1/6 royalities. She wants to sighn it and send it back. She thinks its better to have it leased even if it is for low money. I advised her not to lease until I could find out more information on the Plentywood area. Can anybody tell me what land should lease for in that area? Also could anyone recomend a honest leaseing agent for that area of the Bakken? I know there is activity in that area as I have seen oil rigs around the Plentywood area. I think it would be better to be forced pooled into a spaceing unit then to accept $10 per acre.
I live in the Malta area and the lease on land for natural gas is running on the $10.00 per acre bonus. I was told about 10 years ago when in the Plentywood area that the bonus money was running form $50.00 to $100.00 per acre back then. You might call the local abstractor in Sheridan or Even Daniels Counties, they might know or know someone that does know. Drilling has taken place around Flaxville lately. Good luck!
Is anyone targetting the Bakken up in Sheridan County, MT? There isn’t any active drilling right now and the most recent wells all targeted the Red River formation. I’d love to hear more about it if you have heard they are targetting the Bakken.
Mine are in Richland County, south of your aunt’s. My opinion is that it is better to hold out for something better. Once it is leased, she is stuck and cannot lease it to someone else if the area heats up. I have never received a GOOD offer via a letter but it can sometimes be the start of a negotiation. If they are genuinely interested, they will probably followup with a telephone call. Otherwise, they are just trying to see if they can get something for cheap.
I recently got mineral rights passed on from my grandmother in the Sheridan MT area. (745 acres) was offered $200 an acre and %15 … so if I were you… i would’nt even bother with this person…personal opinion. SOmeone will have a better offer.Good luck
At least tell your aunt there is no need to rush unless they have already started drilling. They do not just show up one day and start drilling a well. Take your time and get competitive offers. Have a professional look over the lease and explain it to you if you don’t think you understand every bit of it. Charges and fees/expenses you have to eat are as important as the royalty% and have a large effect on how much you profit from the well to be. Take your time. The first offer almost always isn’t the best offer, and quite frequently is the pie in the sky, high five, we’re taking the whole office to lunch, offer, when you get an uninformed mineral owner to accept.
I have dealt with an Oil and Gas attorney in Plentywood on several occasions and he is very knowledgeable about the Sheridan County area. His name is Mike O’Toole (O’Toole Law Firm). The offer you stated is extremely low for this area so it would be advisable to contact someone in the area for advice as to the current bonus/% rates. Mr. O’Toole has provided accurate advice so far in my dealing with him back in 2009.
If in fact you own the whole 640 mineral acres in one parcel, I don't think you can be force pooled if you don't sign for the $10.00 acre. Also they can't drill on your property without your permission. From what you've told us there is no permit to drill which gives you time to investigate better options. Your Aunt is right in one way, but if you had more offers they would surely be better, $6401 dollars is better than $6400 all other things being equal. Also, if you politely reject their offer saying you feel it is worth more than they are offering, they may offer more immediately. Keep your cool. You have the upper hand. A good, honest landman is Buddy Cotten. You can find him behind the "Blog" button at the top. If you lease without a good landman you could very easily get taken to the cleaners. There are so many things that can cost you a lot of money in a lease. Please, don't do it on your own. I wish you much luck and hope you make lots of money.