Not sure if its customary to discuss per acre bonus $'s on this forum but I am just trying to educate myself. I have in the past, negotiated from $250 to $300 or above for per acre offers. If this is a low offer range for Oklahoma in general and Jefferson Co specifically, what would the higher end of the offer spectrum look like? $750, $1200 per acre?
The intended product for the well is critical. Since gas prices are so low right now, lease bonus amounts in single reservoir dry gas areas are going to be much, much lower than leases in an area with stacked pays, oil and or gas with lots of condensate. One may be able to negotiate a slight increase over the first offered bonus, but not as much room to go up in a gas play. You can have some counties in OK with $5000/acre and some counties with $50/ac. Also depends upon the royalty amount. Lower royalty gets higher bonus and higher royalty gets a lower bonus.
There are many section 34s in Jefferson. Which township and range? Recent pooling amounts are a general ballpark of what is being offered.
I will pick up on all further corespondence here on this topic since I started it. You suggested scanning in the lease for your review, which is way above the call of duty and appreciated. Being new I am uncertain what is viewable to anyone else or what is just seen by us. I am looking on the site to see how to attach or scan in docs. I did recieve another bump in per acre price this am but several clauses that came with it. It is hard to decifer which if for/against the lessor. My current Jefferson Co offers are for…Township 4 South, Range 4 West, Section 34: NW/4 NW/4 SW/4 and also Township 5 South, Range 4 West Section 3: North 20.36 acres of Lot 4; and SW/4 SW/4 Less and Except the S/2 SE/4 SW/4 SW/4.
Hi, Could you send me Stephens county map as well please? Thank you.
M Barnes, never mind on Stephens map…found one on this forum from another post of yours. You have really helped a lot of folks and for that we are thankful.
Anything put in this open area is viewed by all members if they choose to look at it. So scanning a whole lease is not a good idea. If you want to upload a portion of a clause and ask if that wording is “good or bad”, then the 7th icon in (bar with Up arrow) is how you post a picture or document.
EXHIBIT A – 125%.pdf (99.5 KB)
After pressing for more per acre, they agreed but sent these clauses that were not on the original offer.
Not giving legal advice… just my opinions based upon experience.
Most of this exhibit is entirely in the operator favor.
Marketing Enhancement - puts post production clauses right back in. I prefer to not accept this clause as written. I prefer no post production clauses as all. If they won’t budge, then this clause needs to reference the Mittelstaedt case which puts limits on those charges. Wording is important and you may need an attorney.
Horizontal Pugh Clause. Pretty much covered by a statute already and the most likely spacing is going to be 640 acres, so the whole section will be held.
Depth Severance- I do not want the term “penetrated”. I want the term “producing”. They could drill a pilot hole much deeper then the intended reservoir, then come up and produce from a shallower zone. “Penetrated” would hold a much deeper amount of the section without producing it. You only want them to hold the producing zone.
Shut-in- I prefer the word “cumulative” instead of “consecutive” which has a loophole. They can shut in a well for two years minus a day. They could open it up for long enough to make a profit, then shut it in again for two years minus a day, etc. and drag that lease forever. Also, mechanical reasons were the original intent decades ago and should be taken into account.
I personally do not like options to extend as market conditions can change drastically in three years. $125% may not be a good number at that time.
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