I am a newbie, dont know anything. A landman called with an offer to lease mineral rights that my daughter and I inherited. We didnt know we owned it, but years ago we heard our relatives (since deceased) talk about land they had in Oklahoma. We dont know if the offer is fair: $5600. 1/8 or 5200 3/16 or 4800 1/5. The land is 1.75 acres. We would appreciate any advice we can get. we live in California. Would it be better to sell the land. The landman wants us to lease now and said they could drill without our o k.
Welcome to the forum. Never sell anything unless you know what it is worth… with that kind of lease offer, you may want to hang onto it.
What section, township and range? That way we can hunt down the activity in the area and see what similar offers have been.
Most of us prefer the larger royalty and lower bonus. Ask what they are offering for 1/4 just to find out.
If you are just getting started in the oil & gas business of mineral ownership, welcome… Read the Mineral Help tab at the top of the forum. Read the BLOGS category. Read the last six months or so in McClain county so you know what is going on and what the general questions, advice, etc. have been.
You will probably not want to sign the lease as they put it in front of you as it is all in their favor and not in yours. It will need negotiation.
Have you gotten the minerals through a probate? You will need a clear title in order to lease, get royalties or sell. Lots of comments by Richard Winblad on the forum along that line.
Thanks for your reply the land is Sec31 8N4W. I am not sure if we got it from probate. My wifes sister sold her section years ago according to the landman who contacted us. I have negotiated it and he raised his offer $300. Thanks again for your advice, I will read more of the blogs.
EOG Resources is planning on drilling at least two wells in Sections 30&31 8N-4W. They will be multi-unit (one well going across two sections). Can explain that later.
Contact EOG and be sure that you are on their mailing list for all the Oklahoma Corporation mailings for this section. EOG Resources, Inc., 3817 NW Expressway, Suite 500, Oklahoma City, OK 73112. GREGORY L. MAHAFFEY Contact Phone: 405-236-0478 You may have to prove that you have title. Time to find out how you received the minerals. Probate?
You need to move quickly because there is a pooling hearing on November 18. OK has forced pooling which means that if the minerals are not leased because they couldn’t find you or you refused to lease, the Corporation Commission will choose a lease bonus pair for you. However, they have to have your address and proof of title. You only have 20 calendar days from the pooling to respond by certified mail return receipt. In this case, you need to answer the pooling if you don’t get leased in time. The case is 201905259 and you can follow it on the OCC website. OAP. You do not have much time to get this leased. You can lease during the 20 days, but it is important that the lease gets filed in time. Also, the draft lease that you will get is not going to be in your favor. It takes time to negotiate it to a more favorable form. Answering the pooling is one way to handle the situation. You may have to answer the pooling as the heir of “xx” and let them know that you are in the middle of finalizing the probate.
Find out who the leasing agent is working for. Is it EOG or is it a third party. That may make a difference in the speed and amounts offered. If your title is not completely clear, the timing is not in your favor for leasing and the pooling will be fine.
On the price offered. Leases are private and the bonus amounts are not posted. The closest that you can get is looking at pooling amounts (sort of a government ordained lease) for comparisons. Usually you look at the eight contiguous sections around yours to get a feel. Or close by ones in the area. In this case, none of the eight have pooled, so we look at the next closest especially by the same operator. Section 28 was pooled in July for $2400@ 3/16, $2000 @ 1/5th and $400 @ 1/4. Same for Sec 33 since that will be a two section well with both those sections. Most of us would pick the $400 and 1/4th because a larger royalty pays off much better in the long run. You already know that you will have two wells, so even a better reason. Looks like your offer is pretty good. Ask for the 1/4th amounts.
Speed is of the essence here!
If they start asking for an affidavit of heirship, this will mean that there is probably a missing probate. You can probably lease without a probate but will not likely be paid until one is completed.
I’m also a newbie at this. I received a letter addressed to my deceased father from EOG last March. When I replied I was given directions from a Landman working for EOG and to make a long story short, I filed an affidavit of heirship with McClain County and then EOG. McClain returned all the documentation and I then sent copies on to the landman. One of the landmen asked me to refine the affidavit to correct the description of the mineral rights. He stated that my father owned interest in NE quarter of section 28(West 1.5 rods of the N2 of the NW4 of the NE4 in section 28). Now that I filed the affidavit of heirship neither of the two landmen will return my emails and telephone calls. I don’t know that I’ve completed this process correctly. I’m about to try to work my way of the chain at EOG to try to figure out where I am in this process. Thanks
Stephen: You might want to visit EOG’s owner relations site. https://www.eogresources.com/company/owners/ It is probable that if there are royalties, a probate will be required. I have posted elsewhere regarding the process.
Also searching the Mineral Owner Escrow I found this
Richard: Thanks. I will check into the EOG owner site. Henry M. was my father, but Elizabeth was not my mother’s name. Don’t know what that means. I haven’t seen Elizabeth listed anywhere. I provided all the probate information from the official death records to both McClain County and EOG.