I have been asked to lease our mineral interest in Kern County Californa in Township 25 South, Range 21 East for 1/6th royalty, $25/net acre, 5 year lease. Since I'm not familiar with Kern County, CA. I don't know if this is a fair offer. Sounds low but, I'm used to the Texas shale plays. And, who is the most active operator in Kern County? I would appreciate any assistance.
I would like to speak with you further to discuss your options. Please contact me at: resumelandman@gmail.com
Thank you for your time, MBF Oil & Gas Inc.
Hi ; we got approached by various landman,t26s r 22e so were pretty close,the offers as yours we felt at the time were too low,but we were able to get a bidding war started but afterawhile they ended as fast as they started,its been a year since and again we were contacted,Im going to look to see where your property is located, but oxy petrolium made a huge find in the kern area,go read article.
MBF Oil & Gas said:
I would like to speak with you further to discuss your options. Please contact me at: resumelandman@gmail.com
Thank you for your time,
MBF Oil & Gas Inc.
Oxy owns 80% in Kern County as will as the national. Cheveron owns 20%. You should just google Kern County. I was recently sent the same lease aggreement from Vintage (OXY) on range18 east. Where you offered a yearly lease until they find something. I am still inverstigation. Let me know what you fid out.
buddy; were going to sign leases for 35 an acre 5 yr up front money,that is to say35 an acre x 5yr,We tried for 50 an acre they refused that and gave us 35. But we firmly believe we are part of the oxy find, and hope they either drill on our land or we get into pooling!! The leasing of land all around us has slowed down, and we believe that oxy will be releasing where the find is!! I did alot of research on whos land is getting leased up and its a very large piece, but then so is the find!!
Buddy Love said:
Oxy owns 80% in Kern County as will as the national. Cheveron owns 20%. You should just google Kern County. I was recently sent the same lease aggreement from Vintage (OXY) on range18 east. Where you offered a yearly lease until they find something. I am still inverstigation. Let me know what you fid out.
I have received a proposed lease with exact same terms (1/6 royalty, $25/net acre/year, 5 yrs) and in same T/R (25/21) as KC’s original post above. If someone is offering better terms, I would appreciate any information regarding same. Thanks.
I own minerals in Kern County as well here are the results of the August BLM sale for Kern County.
CALIFORNIA ANNOUNCES RESULTS OF OIL AND GAS LEASE SALE HELD IN SEPTEMBER 2010:
The California State Office of the U.S. Department of the Interior, Bureau of Land Management announced
the results of an oil and gas lease sale held September 9, 2010 in Bakersfield, California. Following are the
highlights from that sale:
BIDDER COUNTY LOCATION ACREAGE BID/ACRE
Vintage Production California Kern 30-25S-18E 320.00 500.00<br/>
Sunset Oil Partners Kern 14-27S-18E 80.00 525.00
Venoco Kern 6,18-27SW-22E 520.00 675.00<br/>
Western Energy Production Kern 2,8,12-28S-22E 640.00 775.00
Aera Energy LLC Kern 2,4,10,12-28S-23E 840.00 1,775.00<br/>
Sunset Oil Partners Kern 2-27S-26E 159.73 250.00
Sunset Oil Partners Kern 10-27S-27E 160.00 375.00<br/>
Vintage Production California Kern 6,20-28S-27E 200.00 80.00
Vintage Production California Kern 24-29S-29E 480.00 210.00<br/>
Vintage Production California Kern 30-29S-30E 645.46 25.00
Vintage Production California Kern 4-11N-23W 40.00 $8,200.00
Vintage Production California Kern 17-11N-23W 120.00 $4,100.00
The sale resulted in $3,600,999.00 in total revenues for the State of California. All 12 parcels offered containing
4,205.19 acres were leased with a high bid of $8,200/acre for a parcel in Kern County. Bids averaged
$854.41/acre.
Here are the high low ahnd average bonus and royalty for the Kern County area
CA KERN X + 2.00 8200.00 375.00 16.67 20.00 20.00 175.00 3.00 5.00
Bill
William Bramlett said:
I own minerals in Kern County as well here are the results of the August BLM sale for Kern County.
CALIFORNIA ANNOUNCES RESULTS OF OIL AND GAS LEASE SALE HELD IN SEPTEMBER 2010:
The California State Office of the U.S. Department of the Interior, Bureau of Land Management announced
the results of an oil and gas lease sale held September 9, 2010 in Bakersfield, California. Following are the
highlights from that sale:
BIDDER COUNTY LOCATION ACREAGE BID/ACRE
Vintage Production California Kern 30-25S-18E 320.00 $ 500.00
Sunset Oil Partners Kern 14-27S-18E 80.00 $ 525.00
Venoco Kern 6,18-27SW-22E 520.00 $ 675.00
Western Energy Production Kern 2,8,12-28S-22E 640.00 $ 775.00
Aera Energy LLC Kern 2,4,10,12-28S-23E 840.00 $1,775.00
Sunset Oil Partners Kern 2-27S-26E 159.73 $ 250.00
Sunset Oil Partners Kern 10-27S-27E 160.00 $ 375.00
Vintage Production California Kern 6,20-28S-27E 200.00 $ 80.00
Vintage Production California Kern 24-29S-29E 480.00 $ 210.00
Vintage Production California Kern 30-29S-30E 645.46 $ 25.00
Vintage Production California Kern 4-11N-23W 40.00 $8,200.00
Vintage Production California Kern 17-11N-23W 120.00 $4,100.00
The sale resulted in $3,600,999.00 in total revenues for the State of California. All 12 parcels offered containing
4,205.19 acres were leased with a high bid of $8,200/acre for a parcel in Kern County. Bids averaged
$854.41/acre.
Here are the high low ahnd average bonus and royalty for the Kern County area
CA KERN X + 2.00 8200.00 375.00 16.67 20.00 20.00 175.00 3.00 5.00
Bill
Thank you for BLM sale info, Bill. Can you advise how those lease prices translate to non-BLM mineral lease prices in Kern? Tthanks.
Rich
I don’t have a corrleative between bonus paid to private mineral owners and bonus paid for public lands. In all fairness when a company bids and is awarded a BLM lease they are getting a 1/8 th royalty and 10 year lease. On the other hand, my mineral acreage was distal to the renewed development when it was leased 2 years ago. I revived a 1/5 royalty and $50 per acre bonus and rental. Over the 5 year term it would be the same as recieving a $250 per bonus on a paid up lease of 5 years. Technology is the game changer for this area. Hydralic Fracutring and Horizontal Drilling have and will continue to enhance the value of the lands. Be aware that in many westren states the mineral owner is often subject to force pooling (I don’t know about California). Before you decide to hold out or take an offer find out what the law is regarding unleased mineral owners and find out what sort of activity is taking place in the area(most states have websites) Let me know if can help you! Bill
rich s said:
Thank you for BLM sale info, Bill. Can you advise how those lease prices translate to non-BLM mineral lease prices in Kern? Tthanks.
Thanks for info and input. Rich
The most active operator in Kern County is Occidental Petroleum, given the new discovery and the new infrastructure they are building to exploit the fields. 1/6th royalty is about standard, $25/net acre is low. If it is OXY offering it, it might be interesting, if another company is offering it, it may be a “nuisance” lease… to give them leverage in selling their leases to OXY, for a profit, of course.
Hi KC,
I have had a similar off at 1/6th royality but at $50/acre - they sent me the paperwork to sign for 5 yrs; but I am investigation as I too believe it is low. I have talked to oil people in Denver and Ft Worth, and some say do not sign the first offer. Maybe even hold on for the actual oil discovery, and then you will share any expenses, but you will be 100% sure of the recover. At the moment, the IRS allowance is 40%. Over.
Me also, same offer as you, a month and half later the offer $75 and 3/16
The offer is VERY low. Shane's $75 and 3/16 is better, but still not good... the most active operator in Kern County for new wells seems to be Occidental Petroleum, though Chevron is big also... good luck!
What are the numbers you are seeing ? I also see liability issues with the lease and no set price for so many fees, what do they pay well head, market est. Its a open contract, great for the oil comp. Thanks
at least $100 per acre, 1/5 royalty, minimum. Open contract? As in through a land management broker?
Its 11 pages of fees and things that I would have to pay. It states what the fees are but not how the price is set. also leaves me liable for damages and so on. Also as I stated royaltys are not stated, if paid at well head at market and so on. Thats what I mean by Open. I have years and years of old leases from this property and none are over 4 pages, and they do not have all of the fees and liability as this one. I do belive MPI is a broker.
I wouldn't sign anything like that... and you are probably right in believing MPI is a broker. Royalties are generally calculated at market given the fluctuation of prices, and as a mineral owner you should have no liabilities whatsoever other than owning the rights you are leasing to the oil company. I'm sure there are great landmen out there, but I prefer not working through brokers.... but hey, that's just me.
Question for anyone - I have been offered a lease from Oxy for mineral rights in Ventura County. 50/acre, 5 year lease and 3/16 royalty. I see alot on Kern but nothing on Ventura - anyone know if this is reasonable?
Nancy Hedges said:
The offer is VERY low. Shane's $75 and 3/16 is better, but still not good... the most active operator in Kern County for new wells seems to be Occidental Petroleum, though Chevron is big also... good luck!