Lease Offer From Bearcat o/b/o Continental Resources

Oklahoma Mineral Rights Stephens County, OK
1

Family has owned rights on two sections in Stephens County, Oklahoma for years.

Over the years, we’ve had previous Leases (2) with intermittent offers to Buy (all refused) holding out for another fair Lease. Still no interest in Selling, optimal Lease offers will of course be considered/negotiated.

The Sections in Stephens County are Section 5, Township 3 South, Range 4 West; and Section 32, Township 2 South, Range 4 West.

Recently Bearcat (a company we’ve pleasantly dealt with previously) contacted us with three Lease options (No Deadline for response yet)..

Option 1: Lease Term of 3 Years with no Option; at one-eighth Royalty (1/8) and a Lease Bonus of $1,002 per mineral acre.

Option 2: A Lease Term of 3 years with no Option; at 3/16th royalty; and a Lease Bonus of $752 per Mineral Acre;

Option 3: Lease Term of 3 Years with no Option; at one-fifth (1/5) Royalty; and a Lease Bonus of $502 per mineral acre.

We own (inherited from 2 generations ago) approximately 4.44 net mineral acres in 32-2S-4W and approximately 1.10694 net mineral acres in 5-3S-4W.

Is anyone aware of other companies than Bearcat “suddenly” anxious to negotiate Leases (not purchases) in Stephens County, Oklahoma? We’d like to get other Lease Offers to consider but don’t want to overthink this. Note too we received a random phone message from Evan (Last Name Unknown) from “Land Hill (?)” with an OK Area Code Phone Number. Does this flurry mean prospects for drilling, etc. are promising for these companies?.

Thanks for any thoughts on our pending Lease Offer from Bearcat. If more details are needed, please let me know. You folks have been invaluable over the years. Everyone be safe.

693

2

Continental has a drilling program in that area. Looks like they are heading your way. Many of us would like the highest royalty possible as the royalties from successful wells over many years from a higher royalty choice will usually far outweigh one time bonus for the lower royalty option.

It would be very wise to get a good oil and gas attorney to review any lease draft as they are usually in the operator’s favor and not the mineral owner’s favor and require substantial edits. If you cannot get a good fair lease with the operator, then there may be other agents who are working for third parties who may be more amenable to better terms.

You can also wait for pooling as it has its own advantages.