I live just east of Cheyenne and about 15 miles north of the Colo/Wyo border. I have a very small acreage and have been approached by a landman with Lone Tree Energy about leasing the mineral rights (I own them). He says he represents EOG, but the lease documents he has provided list Lone Tree Energy as the Lessee, not EOG. Is he likely just speculating rather than representing EOG? I’ve read other comments that suggest insuring the firm you lease to is a “producer” and not just a “speculator”. Comments would be much appreciated.
Thanks, Ted. I really appreciate your input on this and it is worth far more than two cents! 
Bob
Ted Preston said:
Bob,
This is not the first time I’ve heard that EOG and Lonetree have some sort of cooperative relationship in the Niobrara play. What I’ve heard before amounts to little more than gossip, but it’s interesting to hear a landman from Lonetree verify it.
It’s not uncommon for oil companies to employ outside landmen to help them accumulate leased acreage. If the man says he represents EOG, I can’t think of a reason not to believe him. I’m familiar with another landman who has been leasing huge acreages in his own company name, who turns around and assigns those leases to one of the major oil companies. In that situation, I don’t think you’re dealing with the kind of speculator that people suggest you should avoid. You’re simply dealing with someone who has a contract to provide that service to an oil company.
Often, the middleman serves another purpose: identifying and doing curative work to clear up YOUR title. In the case of the landman I mentioned above, he does precisely this. At the moment he has hired me to help him with some of the curative work to clear up title to a leased parcel that I passed to him. I passed it to him with worts on the title, he’s paying me to do the legal work to clear up the worts, and then he will likely pass the lease (now free of worts) to an oil company. We are making our profits on the transfers, but in the end, the oil company gets a lease with a clear title to the minerals which did not exist at the outset.
I also don’t think you should necessarily avoid leasing to an independent landman, even if he or she is a “speculator”. keep in mind that they are speculating on profits from the lease, either in the form of an assignment bonus or in the form of royalties, and usually both. In order to make money, the speculator usually assigns the lease to an oil company, or to another landman, in return for a payment up front and a small royalty interest. In order for the speculator to get royalties, the lease has to turn into a well, which means that the speculator has a similar interest to yours: he wants to put that lease into the hands of a company that will develop it and produce oil. The difference between you and the speculator is that the speculator has time to study the players in the oilfield and determine which one is most likely to invest in exploration soonest. If he does a good job of that, he may actually help you get more money in your pocket sooner, because doing so helps him get more money in his own pocket sooner too.
In the interest of full disclosure, I personally speculate in oil and gas leases, but I don;'t view that as my only role. I usually do the initial title work to identify the mineral owners, find them (I specialize in finding the heirs of deceased mineral owners) and lease from them. Then, I try to clear up the title if I can, gather leases of other fractional interests in the same land, and only THEN assign the leases to an oil company for a profit. Far from just speculating, I’m adding value to the first lease (think of it as YOUR lease) by doing curative work, combining it with other leases on the same land, and passing the whole to an oil company for a profit. In that process I make the leases I’m holding more valuable and more immediately drillable, which benefits me and the mineral owners in the long run.
There’s my two cents!
Bob,
I am leasing in the area if you would like to consider another offer please e-mail me at the addresse below.
Robbie robert@communicomm.com
I think you’ll find Lone Tree Energy IS EOG…see this blog for more info
http://info.drillinginfo.com/urb/niobrara/
“One can easily tell that Lone Tree Energy is assigning EOG leases as shown in the pink. This tool can be used to see the extent of the EOG position and neighboring operator’s positions. You can tell when the acreage is set to expire and thus deduce where EOG may allocate their rigs”
Thanks, Warner. That is a VERY interesting site. I appreciate it very much. Bob
Warner Lamb said:
I think you’ll find Lone Tree Energy IS EOG…see this blog for more info
http://info.drillinginfo.com/urb/niobrara/
“One can easily tell that Lone Tree Energy is assigning EOG leases as shown in the pink. This tool can be used to see the extent of the EOG position and neighboring operator’s positions. You can tell when the acreage is set to expire and thus deduce where EOG may allocate their rigs”
I’ll be in touch. Bob
Robert O’Neal said:
Bob,
I am leasing in the area if you would like to consider another offer please e-mail me at the addresse below.
Robbie
robert@communicomm.com
Robert O'Neal said:
Bob,
I am leasing in the area if you would like to consider another offer please e-mail me at the addresse below.
Robbie
robert@communicomm.com