Leasing if i'm the only royalty owner

Oklahoma Mineral Rights Caddo County, OK
1

I have royalties in 160 acres (1/4 section). Before my dad passed away in 2019 he was able to break the lease on these royalties from 1971 at 1/16 production. Production monies he was receiving was less than 1 dollar a month. Basically the company was trying to hold the lease by claiming it was still producing. They lost and the lease was broken. The other three 1/4 sections are still under the 1971 lease which I do not have royalties in. Currently I am trying to lease my 160 acres in Caddo Co. Oklahoma section 23 9N, 9W.

Questions

If I lease can they only place a well on my 160 acres or can they place it anywhere within the entire section and is it possibly dependent on a well depth clause?

How does this work for a horizontal well? Is my 160 acres only in play or is the entire section in play along with other sections?

Basically I’m trying to find out if my royalties are as lucrative if I’m the only royalty owner in the section that can lease. Sadly I don’t have a copy of the 1971 lease agreement my grandad signed.

2

It depends on the drilling and spacing unit that the Oklahoma Corporation Commission grants. In all likelihood, if there is interest in your section, it will be spaced on a 640 basis or a multi-unit section which would be possibly 1280 or more.

If you lease, or if you don’t and you get statutorily pooled, the well could be drilled anywhere in the section or even to the north or south of the section. In terms of royalty payments, it doesn’t matter whether it is on your tract or in the other 480 acres.

As to a horizontal well, the drilling and spacing unit would likely comprise of your 160 and the other parts of the section or even two or three sections.

It helps your position that you have a large swath of acreage. But, the value really lies in location, location, location. If your minerals are in the fairway, then the market price is higher. If it is not, the value is less.