I am not sure if this is a decent offer or not. This is a 320 acre parcel that I own 1/4 interest in (undefined).
My concerns are:
Injury liability on my property. Water rights (I don’t want to give it away). $4,000 seems low. I got $25K from Chesapeake a few years ago but oil prices were higher. 15% (3.75% is my share?) seems high especially if I am being charged production costs.
Here are some screenshots. What do I go from here?
I wanted to post more screenshots but since I am new I can’t.
I found a way to post these. Thanks
What township range and section are your mineral located in?
T-38 N R-66 W Section - 3:S2
Hi Ted, I am 2 townships below you T36R36. We had a very low offer a few months ago and declined. We also did business with Chesapeake until 2016 for $$$$. Nothing is happening in Niobrara County now, so we are unleased at the moment. This is a low offer and will tie you up for 5 years. I have been in the forum for years and have never seen anybody from Niobrara Co.! Best of luck!
The highest government lease I could find nearby in the last 6 months or so was this one:
https://www.energynet.com/property_information.pl?lot=50798
It has a bonus of $66 an acre and a 12.5% lease rate. I believe their standard lease is for 5 years.
For your offer, I wouldn’t think a 15% lease would be worth your time at this point and I certainly wouldn’t recommend an extension. However I don’t think there are better offers in your area right now. However that could all change at anytime. Hope that helps.
Thank you. Since nothing is happening in this area I’m tempted to go for the cash. I’d like liability protection and i don’t want to give away the water. You are correct though, 5 years is a longtime and I need to understand if there are triggered extensions I’m not seeing.
Yes, this is my dilemma. I could use the $4,000. I did find an added addendum I used to protect myself last time around. I am considering adding to it a lessened timeframe. 3 years with a 2 year option.
