# Offer for an extension of lease for section 1 t19s, r34e
**URL:** https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529
**Category:** Lea County, NM
**Created:** [August 21, 2014, 1:21pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529 "2014-08-21T13:21:50Z")
**Posts on this page:** 13
**Page:** 1
### Author:  [@Rick5](https://www.mineralrightsforum.com/u/Rick5)
#### Post date: [August 21, 2014, 1:21pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/1 "2014-08-21T13:21:50Z")
Hi, this is my first post on this forum. I have been offered a two year extension on a lease I signed and negotiated in 2011. The oil company did drill a well and has a successful, producing oil and gas well. The oil company wants to drill a 2nd well and is offering me the same bonus I negotiated in 2011. I think I should ask for a higher bonus as obviously there is oil and gas under the property. What do you think? Thanks.
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### Author:  [@Bob\_Walner1](https://www.mineralrightsforum.com/u/Bob_Walner1)
#### Post date: [August 21, 2014, 1:50pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/2 "2014-08-21T13:50:25Z")
If the successful well was drilled in Section 1, Township 19S, Range 34E, I would think the lease would be considered “held by production.” But if not, I would try for better percentage and give up the bonus, since the area is “de-risked,” i.e. there is oil down there. Was the well vertical or horizontal?
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### Author:  [@Rick5](https://www.mineralrightsforum.com/u/Rick5)
#### Post date: [August 21, 2014, 2:15pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/3 "2014-08-21T14:15:12Z")
The company wants me to sign an extension lease keeping the same terms as the negotiated lease. The royalty is 25%. I believe the well is vertical. Also, the original lease has a 90-day continuous development clause. The original lease is due to expire in a few weeks. Thanks Bob!
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### Author:  [@Bob\_Walner1](https://www.mineralrightsforum.com/u/Bob_Walner1)
#### Post date: [August 21, 2014, 2:39pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/4 "2014-08-21T14:39:44Z")
You are getting 25% and that is top percentage. I don’t think they will go higher, so go for the bonus. I like that 90-day clause; it makes things move along faster. Who is the operator? The big public companies tend to keep up the pace; smaller operators sometimes have capital squeezes. You might shop it around and get a larger bonus from a competitor. Good luck!
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### Author:  [@Rick5](https://www.mineralrightsforum.com/u/Rick5)
#### Post date: [August 21, 2014, 3:07pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/5 "2014-08-21T15:07:50Z")
The operator is Diamondback Resources. They pay the gas and Plains pays the oil. Thanks for your help Bob.
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### Author:  [@Rick5](https://www.mineralrightsforum.com/u/Rick5)
#### Post date: [August 21, 2014, 5:42pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/6 "2014-08-21T17:42:25Z")
What would be a good lease bonus offer price? They are offering 500 per net acre. It’s a small interest. Only .5 net mineral acres owned by me in the entire S/2.
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### Author:  [@Rick5](https://www.mineralrightsforum.com/u/Rick5)
#### Post date: [August 21, 2014, 6:07pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/7 "2014-08-21T18:07:19Z")
That’s 5 nma not .5
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### Author:  [@Bob\_Walner1](https://www.mineralrightsforum.com/u/Bob_Walner1)
#### Post date: [August 21, 2014, 6:32pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/8 "2014-08-21T18:32:23Z")
I don’t know the current market offers. I have interests in vertical wells drilled in the 1930s. I understand that with the expanded Wolfcamp and horizontal drilling and fracking, there is some activity going on, but I have not been approached. I’ll certainly let this forum know if and when. In Oklahoma, in the Woodford shale, I have been offered $5500 per nma - to purchase, not to lease. Others have been offered $12,500 per nma. The last lease bonus offered was $1500 per acre for a 3/16th. My hunch is that if they have offered $500 they may go $750-$1000.
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### Author:  [@Buddy\_Cotten](https://www.mineralrightsforum.com/u/Buddy_Cotten)
#### Post date: [August 22, 2014, 1:05am UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/9 "2014-08-22T01:05:43Z")
Dear Rick,
As a matter of course, I typically do not recommend extensions of oil and gas leases. I prefer a new lease form, even if the bonus and royalty do not change. There can be additional or corrective language used to strengthen the form and increase your protection.
A short blog post that I penned is located here:
[http://www.mineralrightsforum.com/profiles/blogs/i-have-been-asked-to-extend-an-existing-lease](http://www.mineralrightsforum.com/profiles/blogs/i-have-been-asked-to-extend-an-existing-lease)
Best, Buddy Cotten
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### Author:  [@Rick5](https://www.mineralrightsforum.com/u/Rick5)
#### Post date: [January 1, 2017, 5:45pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/10 "2017-01-01T17:45:18Z")
Well we never signed the extension agreement and now a new company wants to lease this same property for 3 years, ¼ royalty, 850 pnma lease bonus. Will counter with 1000 pnma bonus plus our addendum.
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### Author:  [@Susan\_Drew](https://www.mineralrightsforum.com/u/Susan_Drew)
#### Post date: [April 5, 2017, 12:32am UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/11 "2017-04-05T00:32:33Z")
I agree this is normally held by production unless they did not lease all of the area.
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### Author:  [@Rick5](https://www.mineralrightsforum.com/u/Rick5)
#### Post date: [October 31, 2017, 3:31pm UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/12 "2017-10-31T15:31:47Z")
After months of hearing nothing on this lease offer, we received a call from the landman representing the company. Finally settled on 2,000.00 pnma, ¼ royalty, three year lease term with our addendum. Guess it pays off to be patient…
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### Author:  [@system](https://www.mineralrightsforum.com/u/system)
#### Post date: [August 15, 2018, 12:23am UTC](https://www.mineralrightsforum.com/t/offer-for-an-extension-of-lease-for-section-1-t19s-r34e/9529/13 "2018-08-15T00:23:11Z")