Lease Offer Dawson County Taylor County School Lands

Eh you can put both tracts on one lease but I would include separate tract provisions language

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They claim that is not what they do. What is the benefit of doing it on two contracts?

Thank you very much for your response sir

Apparently there was a previous lease that I did not sign and there is money owed to me also.

Trying to muddle my way through all this your help would be most welcome.

Can you give me an example of what you are talking about? Sorry to be dense I assume you are speaking of a clause that excludes actions on one part of the lease? Not sure I follow.

If it were me, I would lease the two tracts independently. Just insist on it. You do not want them tied together. They can have identical leases.

Thank you for your reply

I am thinking in the following manner as far as a counter offer is concerned.

Separate lease per each property

No Pooling

3 Years

No Option to extend

$600 per acre

25% royalty

If any of you are following this and have an opinion on this please reply.

I also am not clear on how to calculate mineral acres.

Thank you in advance for your input.

@Ronnie_L_Jones, who is this lease offer from? CGS? If CGS, then you can likely get $550-700/NMA with a 22.5% royalty.

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Thank you very much for your reply

working on a few details

currently $600 and 22,5%

@Ronnie_L_Jones, be sure to push for a 25% royalty. A lot of brokers out there with no plans on drilling so the higher royalty helps you out in the long run when an operator does come along to develop.

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I agree with Oilman30. I always advise to push for 25% royalty. Whether bonus or royalty always go over the top and let them try to negotiate you down. If they are truly interested they do their best to work with you whether they act like it or not.

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our family also has leased land to cgs operating in the munger subdivision of taylor count school land. we leased out 244 acres. when i spoke to the man on the phone he informed me that 600 acres where needed to create a unit before any drilling would begin is this the industry standard. if so how can i find out if my neighbors have leased there land also

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This funded on the 13th 600 and 22.5%

sorry for the delay yes

They did not agree to this and stated that “It would be useless as singlel units.”

CGS is representing EOG. They can afford the 25% royalty. If they refuse then be adamant about two units in order to receive two bonus payments. Be wary of other offers as CGS is the only legitimate group leasing in that part of Dawson and Gaines Counties. The rest are just flippers looking to make a quick buck with zero intention of ever personally drilling your land.

Oilman30, Any idea what is Oxy doing with the tens of thousands of acres of minerals it has leased in Gaines county? Has the acquisition of Anadarko stalled Oxy’s development plans in Gaines county?

I’m not sure what their plans are in Gaines County. I do know that they have significantly slowed down their drilling schedule in the Delaware Basin since the acquisition. They now have to sift through and compare their OXY position with the newly added Anadarko position and determine what is best to drill first. Expect OXY to be slow in newer areas for them like Gaines. My guess is they will focus on their southern acreage more and/or focus on their Delaware acreage once some of the parent/child well issues have been sorted out.

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I think the Gaines county stuff is under a different division [Permian Resources?]. Oxy bought Hess’ interest in a Gaines county field for $600 million, but additionally leased in areas with no existing production for what may be an unconventional EOR [Clearfork?] prospect which might employ experimental dual function injector-producer wells from what I have been able to gather.