Offer of oil & gas lease and request for seismic survey - Converse County Wyoming (Niobrara)

I am mineral rights owner and surface rights owner of just over 7000 acres in northern Converse County, Wyo. Initially contacted to permit 3D seismic survey of all land. About half is both min rights and surface; rest is surface only. First offer was $5/acre but quickly raised to $10. About two weeks later received interest in leasing some of acreage where own mineral rights. A lot of activity in this area now and in early stages. Question: $10/acre seems low; what is reasonable rate for 3D seismic survey in this area (part of Niobrara Shale new activity). Should I pursue leasing it first? Since I don't own all mineral rights on entire acreage, can company (Samson) go ahead and do seismic survey on surface rights acreage anyway?

Thanks.

I am not up to speed on seismic prices in this part of the country but if you are interested in additional offers to lease your lands, I would like to talk you.

Robert Landman (405) 420-7557

Hi, I am a stock holder of Samson Oil and Gas (SSN), not the Samson you are talking about but I can tell you, Samson Oil and Gas are doing a 3D seismic over their whole remaining acreage in Goshen County in October. Has been permitted and staked this month. The cost of doing the 17,000 acres is estimated at US$2m acccording to their research partner Enercom. I have also read that Samson (your Samson) are joining with Chesapeake (CHK) in the 3D survey you are talkiing about. They are the most prolific driller onshore US in shale plays and are still buying into Niobrara.

see news here

"By SCOTT BORKGREN Reporter Tuesday, September 21, 2010 9:36 PM Mountain

Clearly, it indicates that there is another play as big as, if not bigger, than what Chesapeake is looking at in our county, County Commission Chairman Ed Werner said.

This is the inclination Allstate Permit Services gave when they discussed their future involvement in Converse County. Allstate has been contracted by Samson Investment Company to enter into permits with county landowners for the purpose of 3-D seismic imaging of an area larger than 240 acres roughly 20 miles north and east of town. The actual imaging will be performed by Geokinetics.

Allstate and Geokinetics will be performing the same role for Samson that Dawson Geophysical and McDonald Land Services have been performing for Chesapeake Energy, but they will be doing it in a different area of Converse County.

Allstate Senior Permit Agent Michael Sabin said seven mineral and permitting agents are currently in Douglas, but potentially 45-60 seismic crewmen could be in town in late October.

With the special conditions that we have with the landowners, we are not really starting this project until after hunting season and we will be off the properties no later than March 31, Sabin said. They say that Douglas is the northern extreme of the Niobrara Oil Shale field, and I think it is pretty obvious from what Samson is doing and from what Chesapeake is doing that they are pretty convinced there is something underneath the ground.?

Sabin said a permit agent will likely be present during imaging on property to assure a land owners specific agreements are being followed.

I know that some of the landowners havent been happy with the previous company that was up there, but I think we can alleviate a lot of these anxieties by having a permitting agent on site for these land owners, Sabin said. This is not 1975 or 72 or 1980 where people came in, made a quick buck, got the heck out of Dodge and left the landowners holding the bag. These people are in it for the long run. They have invested hundreds of millions of dollars and they want to be a working neighbor."

all the best

Did anyone determine if $15/acre was a fair price? We’re north of you (Bakken) and just passed on that price. We figured that if they’re willing to pay $25 in TX they might as well do the same in MT.