I have been contacted by a company which would like to discuss a 3yr/2yr option lease on my 86.7 ac in north Lavaca Co. Has anybody had leasing inquires from them and does anyone have knowledge of their busines reputation. I would appreciate any info members have. The companyis Cypress E&P Corp—Austin Tx
Cypress is a company of good reputation, they should be candid with you as to the scope of their ambition to assemble a drilling block. Lease terms, of course, have been inflated greatly with the arrival of the Eagle Ford Shale in the area … so make certain to understand whether this is a Eagle Ford Shale or Wilcox lease/drill. Otherwise, I’d be cautious of the 2 yr. extension unless it’s for an incredible amount. Good Luck!
John, I will agree with Rocky on the 2 year option. A lot of us in Gonzales county are just getting into our option periods with means we got leased very early in the game. A ton of acreage for 100/acre and most of us signed options for 150. So instead of starting new leases for 1200-1700 we are stuck. It is definitely a win for the leasor as everything is in their favor on the option. Try to get the 3 year only or like Rocky says, a very good option number.
Thanks for your reply. Your experience is good information. Thanks again.
Rocky Arrell said:
Cypress is a company of good reputation, they should be candid with you as to the scope of their ambition to assemble a drilling block. Lease terms, of course, have been inflated greatly with the arrival of the Eagle Ford Shale in the area ... so make certain to understand whether this is a Eagle Ford Shale or Wilcox lease/drill. Otherwise, I'd be cautious of the 2 yr. extension unless it's for an incredible amount. Good Luck!
Thanks for your reply. Drilling has started around here so it seems that if good wells are produced it makes sense to give a 3yr lease and hope that the ultimate leasee will drill. If he doesn’t I would be in a position tohopefully get a new lease with a good bonus.
Morgan Barnett said:
John, I will agree with Rocky on the 2 year option. A lot of us in Gonzales county are just getting into our option periods with means we got leased very early in the game. A ton of acreage for 100/acre and most of us signed options for 150. So instead of starting new leases for 1200-1700 we are stuck. It is definitely a win for the leasor as everything is in their favor on the option. Try to get the 3 year only or like Rocky says, a very good option number.