Lease offer Garvin

We have previously leased with Continental Resources thru Red Sky Land. Anyone familiar with Turner Oil & Gas? Received an offer of $600 per acre for 32 & 33 1N1W. Any help appreciated. Seems really low offer? Thank you for your help!

Yes, Turner has been around for a long time and have been one of Continental’s brokers for quite some time. They are one of the bigger brokerages in OKC.

Yes, Turner has been around for a long time. It is helpful if you post the royalty that goes with your offer as that is an important detail. The first offers are usually for the lower royalties such as 1/8th and 3/16ths. I always ask for the 1/5th and 1/4 offers. Those will be less bonus, but I am usually hunting for the highest royalty since in the long run that brings in more money. (If the well is moderately successful.) Continental is the main player in that township.

Offers are lower this year than in the past for multiple reasons. I usually try to look up the most recent poolings nearby to get a feel for what the orders are. Continental just pooled sections 20 & 19 just to your north in 2021. the pooling was for $650 @ 1/8th, $550 @ 3/16ths $450 @ 1/5. Continental is playing a wedge of Woodford with gas/condensate. There is a pooling case for section 32 which was supposed to have been heard on July 13. Keep your eyes open. You only have 20 days in which to respond after the order. It was moved to 8/17. Then moved to 9/14/21. Continental’s first draft of lease will need some negotiation to get more into your favor. I have no problem with pooling.

To clarify, generally a respondent has 20 days from the date the order is issued to respond. There has not even been a hearing yet so no need to be concerned.

Good summary. I’ve got 80 acres in 13 1N 1W that RedSky leased. Lease is over in January. Hoping they will re-up

A large majority of mineral owners in these sections have OGLs that are going to expire later this year. The leases have Right of First Refusal language. My guess is that the best thing to do is allow the lease to expire and then negotiate with whomever you want. I imagine that you will find offers greater than what you are being offered for a Top Lease of your interest.

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Based on poolings and talking with others in that area, that’s about right on the offer price for this particular area right now.

Thank you very much for all your helpful comments!

Does anyone know of any other companies that will be leasing in this area

There will be. Be patient as your lease prevents you from signing with others for now. The more acres you have the more folks will contact you.

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Thank you for your help! Greatly appreciated comment

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