Mountrail County North Dakota oil lease

Oil and Gas Leasing Help
1

We just received an oli and gas lease form Hess oil coproration. The offer is 3 years, $500.00 an acre and 3/16ths royalty. We are trying to research to see if this is a good offer or not. We are not from the region so do not have a network to talk to. Also we do not understand the gross acres which is 80.00 acres and the net acres which is 8 acres. How is that figured?

Thanks for your help

G

2

Our situation is similiar to the one that “G” just described here. Our mineral rights are in Burke County, ND and we received a Top Lease offer that is for more upfront cash per acre ($650), but it is for a 5 year lease with a 2 year option for renewal. A 3 year lease would be far more attractive to us. The Top Lease Company is offering to buy out the remaining time on our current lease which expires early next year. As I understand it, Hess will be the producing driller for our property as well, with a 3/16 royalty agreement. We haven’t agreed to the terms of this offer, but are very intrerested in knowing what the other mineral rights owners in our township (163) or in Burke Co. in general are contemplating. I too would like to know what is meant by the term Net Acreage, vs Gross Acres.

Thank you.

M

3

I also, have mineral rights in Burke County ND. May I ask which company offered you $650? We have been recently approached with an offer, not as good as yours, but for a shorter time.

We are trying to do as much research as possible.

Thank you, Bill

4

Hi Bill. If you’ll call me I’ll be glad to help you as much as I can. 330 823 9566 Evenings about 8:30 central time are good, or mornings between 8 and 9:00. I’m not a pro, but I’ll share what I know,- for free.

Best, Mark

5

Hi Mark:

I was just wondering which company you are dealing with?

6

We have recently been contacted by a company wanting to buy our mineral rights (that are currently leased) in Burke County. Do you have any idea what they are worth per acre?

Thank you, Sue

7

Sue

If you would like you can email me or call me and I can try and help you out. I would need some additional info to be able to give you a better idea. A matter of 8 miles can change the price by hundreds.

Mat Ekblad

701-770-4216

Sue said:

We have recently been contacted by a company wanting to buy our mineral rights (that are currently leased) in Burke County. Do you have any idea what they are worth per acre?

Thank you, Sue

8

Sue,

if you are interested in selling your mineral rights or a part of them email or call me and I'd make you an offer also to consider as I buy mineral rights in all western producing counties of North Dakota.

Tim Metz

email address: tm59707@classicnet.net

Telephone # 580-227-2456

9

I just CRINGE when I see people talking about SELLING mineral rights. You may be giving away a fortune for an amount of money that looks good in the short term. Please read up on how valuable Bakken mineral acres are. You can do some reading in the Bakken google group, or ask a question there:

http://groups.google.com/group/bakken-shale-discussion/topics

Sorry--what I see on this website is people waiting to pounce, people waiting to buy your minerals instead of giving objective advice. The google group is WA-A-A-Y better at offering advice, because it is composed of mostly MINERAL OWNERS, not oil businessmen.

10

Thank-you Ruth for your advice. I am G the person that initially posted on this. We never went with the Hess offer which eventually expired. As we proceeded to work with an attorney we discovered a "cloud" exsisted on our rights which was the land owners had staked claimed. 6 months later the judge has ruled in our favor. W are looking to proceed. Not living in the Mountrail area I will take your advice and join the google group. I feel that my grandfather who homesteaded in Stanley is still an intrical part of this. Our families goal if we do gain substantially is to give back in memory of our ancestors.

11
I strongly disagree with the statement that we are here waiting to pounce on people and the implication of worse. Minerals may have been a gift from above to some but for all others they were bought and sold or if you believe the Indians, they were all stolen from them. I also believe most are very helpful here with their offering of advice, experience, wisdom and not deceptive as some might portray us to be. Water finds it's own level and so does the value of minerals even in North Dakota. Try to help someone get a better price by making an offer when they need or want to sell and someone else has to be rude about it. We are blessed though that we have one saint amongst us.
12

I wish I knew.I think that info should all be on the royalty check stub accounting.Mine is not on there but I have minerals in Mountrail also.

13

I would like to know what the highest price anyone has been paid per acre in Mountrail.

14

so far attorney states $1250.00 in mount rail north dakota.These energy companies taking total advantage, of people that are not familuar with oil buisness. then they hand out bogus leases.M y lease states 1/6 th not 1/6th royalty. They deceived us on our lease. My rights are located in mountrail, in big bute. I have done research on lease prices in north dakota, some are making up to 4,000. When does the risk lay on oil companies shoulders?The only people getting ripped off are the mineral owners.The energy companies have known about the oil in north dakota for the last 60years.

32acesinthehole said:

I would like to know what the highest price anyone has been paid per acre in Mountrail.

15

I guess you lost me a bit. You say your lease states 1/6th, not 1/6 royalty. That is where you lost me.

Also I have a lease to be signed in Billings. $1000/ acre and 20% royalty. Your mentioned $4000. That is a lot higher. Do you care to offer any advice?

16

Mr Gapp, it is near impossible to know if your Billings Co. offer of $1000 is the best you can do. It is similar to what I've recently been offered. Yet even a couple miles may make a huge difference in lease offers. It is certainly better terms today than it was a couple of years ago. Though I doubt they are reaching anywhere near the $4000 level.


The best you can usually do is look for the bonus amounts paid on State or Federal (BLM) leases near your minerals. Individual owners are almost never offered those same terms but it gives you an idea of the "top end" in an area. Some Billings Co state leases just went for $1200 to $1500, while two years ago they went for $250 to $375 in that same area. Two companies which are currently picking up activity in Billings Co are Continental Resources and Whiting Petroleum. Depending upon where your minerals are, one or the other may offer you your best terms.

James Gapp said:

I guess you lost me a bit. You say your lease states 1/6th, not 1/6 royalty. That is where you lost me.

Also I have a lease to be signed in Billings. $1000/ acre and 20% royalty. Your mentioned $4000. That is a lot higher. Do you care to offer any advice?

17

Yes that is correct, my lease states 1/6th of all oil produced at mouth of well. It does not state 1/6th royalty of all oil produced. I am discovering more and more about these oil co’s. as time goes on. I had hired an attorney and he also has sat on his hands for 2 years. just don’t know who a person can trust when it comes to oil. And can’t put all the blame just on oil companies. The energy company that signs lease agreements are to blame also. There is a lot of information that these companies are hiding from mineral owners that do not live in immediate area. Putting out bogus leases, and manipulating owners with false information.I had watched interview with T. Boone Picken, if you are aware of who he is? He was bragging about the large proffits off of the peoples oil, he is making.
James Gapp said:

I guess you lost me a bit. You say your lease states 1/6th, not 1/6 royalty. That is where you lost me.

Also I have a lease to be signed in Billings. $1000/ acre and 20% royalty. Your mentioned $4000. That is a lot higher. Do you care to offer any advice?

18

Exact same cenario here. Hess you should watch, because nothing adds up when it comes to them. I have 37.8 gross acres that was worked out to 9.6 net mineral acres. But that acerage is figured out by the energy comp. And if you have Lone Tree Energy once the lease is signed they don't care who gets burned on their lease. Be sure you read your lease very carefully if lone tree is the one you sign the lease with. Because I do believe they probably use same leases. Make sure you read the lease carefully. Seems funny how you here how wealthy all the local mineral owners are getting in ND, and the not locals getting shaft? Pretty clear how it works in ND.

19

32acesinthehole:

You can go to the North Dakota State Land Dept. website and click on "Minerals Mgt. Div." and see what operators have paid over the past year(s). Keep in mind that this is a State auction and you will not get that kind of money for your mineral lease but it will give you an idea what has been paid in the past.

32acesinthehole said:

I would like to know what the highest price anyone has been paid per acre in Mountrail.

20

Hello, I work for an oil company and although there are a few out there that are not completely ethical, not all of us are out to profit at the expense of mineral owners. It is a job--Would you expect a plumber to not get compensated for working on your toilet? Some of these mineral interest owners have messy land titles that need cleaning up--Ex: you own interests, but say they were your great great grandfathers--the more honorable oil companies will trace your ancestry back generations, procuring documents which entitle you to be the legal owner--this way, if a rig is drilled on your land, you would get the royalty checks. If this title curative never happens...those checks would go to the last known address of the technical owner (your great great grandfather). This process of getting interests into the current owner's name is a tedious one as well as expensive. This is why oil companies offer the royalty percentage anywhere from 12 to 18.75%--so they are duly compensated for this work(and they recieve the remaining percentage out of the 20). It would either be that or a lower sign-on bonus for some cases.

As far as the gross acreage/ net acreage total... You own 9.6 acres out of the 37.8 acres in that particular township-range-section. You don't own the total 37.8--that is just what your actual acreage lies on, if that makes sense?

Also a lot of oil companies are not local (Hess is from Texas)--some are from Colorado-Nevada-etc.

There are a lot more factors at hand here than just oil companies trying to make huge monetary profits at the expense of the mineral owners (although some of them do)--it is not a practice all of us adopt and that I can assure you.

Donald R. House said:

Exact same cenario here. Hess you should watch, because nothing adds up when it comes to them. I have 37.8 gross acres that was worked out to 9.6 net mineral acres. But that acerage is figured out by the energy comp. And if you have Lone Tree Energy once the lease is signed they don't care who gets burned on their lease. Be sure you read your lease very carefully if lone tree is the one you sign the lease with. Because I do believe they probably use same leases. Make sure you read the lease carefully. Seems funny how you here how wealthy all the local mineral owners are getting in ND, and the not locals getting shaft? Pretty clear how it works in ND.