Help with mineral lease - Dunn County, ND

My family has been approached to lease our mineral rights in Dunn County ND. Offer was $400 per/acre and 1/6 royalty for 3 years.

We currently have a lease with another company that will expire in Dec. 2012. The company pursuing the lease will pay up front now before the current lease is up.

My concern is whether or not this is a fair exchange? Comments and knowledge from others more experienced would be appreciated.

Thanks!
Sue

What company has approached you?



Gerald said:

What company has approached you?
I am not sure I should say?

Dunn co is a pretty big place. I have been offered $2,100 and $3,000 and 1/5 for some of my minerals. I won’t say you can get that much. There are too many factors and as always location, location, location. I’d get more offers before leasing. The company that went to $3000 on mine first offered $200/20% then $500/20% then $1500/20% then I offered it to another company that offered $2100/20% and the first company offered $3,000/20%. If they were the lone bidder I’d have never seen that offer. RWK



r w kennedy said:

Dunn co is a pretty big place. I have been offered $2,100 and $3,000 and 1/5 for some of my minerals. I won't say you can get that much. There are too many factors and as always location, location, location. I'd get more offers before leasing. The company that went to $3000 on mine first offered $200/20% then $500/20% then $1500/20% then I offered it to another company that offered $2100/20% and the first company offered $3,000/20%. If they were the lone bidder I'd have never seen that offer. RWK
Wow - that is a great deal. That is my fear that we will lease when we could have gotten more. There are several other family members involved. Thank you so much for your comments. SF



Sue Furniss said:

This would be in T. 143N 91 W Thanks again for your comments.

r w kennedy said:
Dunn co is a pretty big place. I have been offered $2,100 and $3,000 and 1/5 for some of my minerals. I won't say you can get that much. There are too many factors and as always location, location, location. I'd get more offers before leasing. The company that went to $3000 on mine first offered $200/20% then $500/20% then $1500/20% then I offered it to another company that offered $2100/20% and the first company offered $3,000/20%. If they were the lone bidder I'd have never seen that offer. RWK
Wow - that is a great deal. That is my fear that we will lease when we could have gotten more. There are several other family members involved. Thank you so much for your comments. SF

Hi Keri - this is actually in North Dakota (not Colorado). So does the same hold true for the price in N.D. ?

Thanks!

Keri Morales said:

I am not currently working in Colorado however I was earlier this year. $400 & 1/6th is pretty low. In your best interst hold out prices are going up!

Thanks Keri - I wondered why they were jumping on this so quickly. Are you saying negotiate with this compnay or hold out for other companies? I know it is a gamble either way. Thanks again.

Keri Morales said:

OK .. Yes this holdstrue for all areas. The oil market is warming up. They want to top lease you now so as prices to increase you are already leased and have no other options. Holding out is always best. As the term of your lease gets closer you will surely get an influx of offers! NEGOTIATE!!

I did not know that “top leasing” would occur this far out from the expiration of a lease. Is this a common practice in the “hot” areas of North Dakota?

PLEASE FOLKS!! I understand the excitement of your possible windfall of "found money" and I realize all the freedoms and possibilities that may be provided to you by these, but before you make YOUR decision please watch the documentary "Gas Land"..…

Thank You



Steve said:

PLEASE FOLKS!! I understand the excitement of your possible windfall of "found money" and I realize all the freedoms and possibilities that may be provided to you by these, but before you make YOUR decision please watch the documentary "Gas Land"..…

Thank You

Sue, I am a landowner in similar position, with lease expiring in October 2011. Dunn County. Did you except any leases yet? What kind of offers are you getting? Can you say what companies are approaching you?