I have a lease where there is a producing well and just received an offer to lease the same section but only the portion below where current producer is working. Is this a good idea or are there any issues I should be aware of?
Cindy
If the producing well does not hold the deeper rights through the existing lease, it is a very good idea as you will get leasing bonus money and hopefully more recurring income from additional production. If possible, it seems like it would be advisable to get an attorney to review both the proposed and existing leases, especially for any conflicts with each other.
Agree with AJ. I also make sure that the new lease quotes the date and portion of the old lease that is relevant and the depth of the reservoir perforations of the well that is holding the lease.