Is anyone out there leasing with Triangle Petroleum in Township 149 N Range 100 W (McKenzie County, ND. Can you share what they have been offering or what I can expect? The probate process for my mineral rights is almost completed and I will be in a situation of having to deal with this very shortly. Any info would be greatly appreciated. Have a Great day.
PUpsahl
PUpsahl:
First, much will depend on the number of net mineral acres you have. McKinzie County is Triangle Petroleum's bread and butter as most all their recent drilling activity has been conducted in this area. The area in T140;R100 has been very active over the past few years but don't know the production figures on the wells in the area. Again, depending on your holding size, you should be able to obtain a very good lease but don't take the first offer as shopping around with other operators may be beneficial to you. In May, 2011, the ND auction (BLM) indicated that $6,600/acre was paid for acreage in T149;R101;Sec 5. This was based on a 5 year lease and generally the amounts at these State Auctions run much higher than what you will negotiate for a 3 year; say 20% royalty lease. Again, take your time once your paperwork is in order and don't get in a hurry to sign.
Interesting question. I would say the royalty should not be less than 20% with absolutely no deductions other than taxes. The bonus becomes more difficult to decide because there are already 1 well on the 3-10 spacing and 7 wells drilled in the 4-9 spacing. I hope you have been paying attention!
While 4 wells in the 4-9 spacing have been spud and drilled in late February to very early March and are DRL status, two of those new wells are already showing production.
There was an additional, abortive attempt at a well which has been plugged, it did not get over 2,300 feet before it was plugged and abandoned.
If you are seriously considering leasing and have not received AFE's for the wells, I would consider a farmout agreement with some entity other than Hess Bakken Investments. There are hard figures you could show to any prospective business partner right this moment. I'd think it over if you did not absolutely need the lease bonus because you will get paid a considerable amount for back production in the near future anyway.
Your area has been held by production for years and I believe the last high I heard of was $4,000 per net acre. I would go north of that. I would say that $6,000 would not be out of the question with 8 wells and probably many more to come in the future. What I would question is if leasing is in your best interest.
Charles:
Thanks so much for the info. Greatly appreciated. This information will be very helpful when the time comes. Hopefully soon.
charles s mallory said:
PUpsahl:
First, much will depend on the number of net mineral acres you have. McKinzie County is Triangle Petroleum's bread and butter as most all their recent drilling activity has been conducted in this area. The area in T140;R100 has been very active over the past few years but don't know the production figures on the wells in the area. Again, depending on your holding size, you should be able to obtain a very good lease but don't take the first offer as shopping around with other operators may be beneficial to you. In May, 2011, the ND auction (BLM) indicated that $6,600/acre was paid for acreage in T149;R101;Sec 5. This was based on a 5 year lease and generally the amounts at these State Auctions run much higher than what you will negotiate for a 3 year; say 20% royalty lease. Again, take your time once your paperwork is in order and don't get in a hurry to sign.
Thanks again for your expertise in this area. You have been very helpful throughout this journey with your responses to my questions. I am not familiar with what AFE's are and Charles Mallory had mentioned farming out. Also not sure what this means. Thanks again.
PUpsahl
r w kennedy said:
Interesting question. I would say the royalty should not be less than 20% with absolutely no deductions other than taxes. The bonus becomes more difficult to decide because there are already 1 well on the 3-10 spacing and 7 wells drilled in the 4-9 spacing. I hope you have been paying attention!
While 4 wells in the 4-9 spacing have been spud and drilled in late February to very early March and are DRL status, two of those new wells are already showing production.
There was an additional, abortive attempt at a well which has been plugged, it did not get over 2,300 feet before it was plugged and abandoned.
If you are seriously considering leasing and have not received AFE's for the wells, I would consider a farmout agreement with some entity other than Hess Bakken Investments. There are hard figures you could show to any prospective business partner right this moment. I'd think it over if you did not absolutely need the lease bonus because you will get paid a considerable amount for back production in the near future anyway.
Your area has been held by production for years and I believe the last high I heard of was $4,000 per net acre. I would go north of that. I would say that $6,000 would not be out of the question with 8 wells and probably many more to come in the future. What I would question is if leasing is in your best interest.