Lease offer Garvin County

haven’t been on this forum for several years. have an offer; 3 year, .20%, $450/acre for small acreage in !N 2W section 25. had basically same offer 2 years ago by same company. is this a reasonable offer?

thanks

J Donley

Continental Resources has quite a few regulatory cases in the last two years in nearby 23 and 24. The last pooling order was in late 2020 in section 24 for $1305 1/8th, $1215 3/16th, $1035 1/5, $360 1/4. I use any pooling in the last 12 months in the contiguous eight sections around my section to gauge the reasonableness of an offer. I usually ask what they are offering for 1/5th or 1/4 and take the highest royalty. The bonus is usually insignificant compared to the long term higher royalty benefits. Also, the clauses in the lease are much more important than the bonus. The draft lease is not usually in the mineral owners’ favor. Getting an oil and gas attorney to look at it can be worth the cost in the long run.

We have a lease on 80 acres in 1N1Wsec13 that is up for renewal this fall with Continental.

Are these OCC Orders available through the OCC Database - Online Case Processing System?

Yes,

Pending OCC cases at the following link: http://www.occeweb.com/caseprocessingonline/default.aspx

Actual cases if you have the case numbers: http://imaging.occeweb.com/imaging/OAP.aspx

appreciate. our O&G lawyer pointed out 5 clauses that were not in our interest. our acreage is so small that Continental would not budge on the clauses…we can take it or leave it. us three brothers will visit about it, but imagine we will sign a lease for .20%. the last time we leased this tract [4-6 yrs ago] we were able to make changes in some clauses. and much better terms.

thanks again

Donley

You can wait until the pooling instead of signing a bad lease. Some companies won’t budge, so that is when I take a pooling at the highest royalty offered.

Donkey- I own a small piece here too. I’ve been offered a little more then that. Not much more. Working on lease form now.

We have mineral rights in Garvin County, Sections 22 and 34, where land men representing several different companies over the past decade and even longer have paid us bonuses for our leases but so far there has been no drilling. If one waits for pooling, are you possibly missing bonuses? How does one tell whether to ignore bonus offers on leases? I am fairly ignorant about these issues. Are they paying us bonuses to prevent others from drilling?

You would have to give a complete section, township and range got a more precise answer.
Pooling is a type of very short lease mandated by the OK Corporation Commission. The bonus you get is similar to a lease bonus. The whole idea is to drill if economically feasible and prudent. With Covid last year, not much happened. Some areas are starting to open up for drilling again.