Did anyone else receive a letter from Jackfork Land Inc? What are your thoughts?
What is the letter about?
Jackfork says they are representing Roan Resources. They provide specifics about the drilling of wells that they say will take place (however, we know that drilling of two wells has already been completed and the wells are active as of 3/10/2019 per the OCC website). They offer an option to participate in the drilling or $300 for 1/8, $350 for 3/16, and $400 for 1/5. The final paragraph indicates the letter is for curative purposes and subject to verification of title and they may withdraw the offer at any time. The offer will expire in 90 days (if not withdrawn, I suppose). I was curious as to how others view this offer. I have assumed that we were HBP since we’re being paid for producing wells but I’ve never had a legal opinion.
Those numbers do not make sense. Less $ for a lower royalty?
They have already started drilling the wells and there is a pending pooling coming. There was a pooling about in 2017 and the wells did not get drilled in time. This is a standard letter send out before the pooling. I do not answer them, but it is a good indicator for what the pooling will be (if the numbers were correct). There are probably a bunch of expiring acres and previously pooled acres, so this is an “oops, we need to pool” cleanup pooling. Interesting in that last time the amounts were $800 3/16ths, $668 1/5, $0 1/4 back in 2017.
Good catch, Frank. My mistake, it should be just the opposite. $400 for 1/8, $350 for 3/16, and $300 for 1/5.
Thanks Martha. Always appreciate your research and thoughts.