Anyone seen any leasing activity in Zavala County recently? thanks
Our family leased land about a mile north of the Dimmit county line in Zavala county. The land is just off FM 1867 going from Big Wells toward Uvalde. This was leased to the Dan A. Hughes company out of Beeville, Texas. The Hughes company got a lease permit in Section 74 in September and this is just south of us in Zavala county and we are waiting to see the results of that well.
Very little in Zavala County. I have had some landmen contact me but the companies are going to the deeper play which seems to be in Dimmit county.
Thanks, Gentlemen. You have confirmed what I am hearing. Most of the action seems to be a little south of us.
My mother has recently been contacted by CML exploration. She has mineral rights on a little over 500 acres just east of Crystal City and the lease offer was $200 an acre for 2 years surface to 100 feet for the mineral shale/Austin Chalk and 1/20 royalty. They told her she could still lease for the deeper eagleford shale but I've been reading that if there is activity above this, it may be difficult to tap the eagleford minerals. I'm just getting educated on the ins and outs of this but any suggestions would be greatly appreciated.
I would ask your neigbhors what they have been doing. The area east of Crystal is not a bad play for the eagleford. I would hold out for that. The companies will be getting back to us after the prime acreage is worked.
could you address the question about drilling eagle ford if you first drill austin chalk.....is it possible to do both?
It is possible to lease the deeper rights and have them drilled. In fact I've actually heard of this taking place in Zavala county over the past couple of years. That said, and with a possible Pearsal shale landrush on the horizon in Zavala as well as surrounding counties, common logic would lead me to steer clear of a shallower, much cheaper lease that might in any way deter or discourage another company from leasing the deeper rights. Unless of course the shallow leasing company was working in partnership with a company that was willing to lease the deeper rights at the same time. To that end, Brian W's recomendation to Tim R above is dead on in my opinion! Especially for a low ball offer like $200 an acre and 1/20 royalty (really 1/20???). That's no where near enough to justify tying up a possible deep well surface location. The going royalty rate for the Eagle Ford shale wells is 5X higher at 1/4!
wznhnt said:
could you address the question about drilling eagle ford if you first drill austin chalk.....is it possible to do both?
when it said 1/20th was it actually 20% ? that would be much more common. ( that would be 1/5th) If the leasing companies are focused on the EF shale it makes some sense to restrict leases to certain depths with Pugh clauses depending on where you are. Best to get some good advice from someone who knows the area's geology. a good place to start finding things out is the Texas Railroad Commission's website. They have a map where you can look up wells and research them. If there are nearby fields with lots of shallow wells then you might want to look into it further
All good points Andy! Pugh clause is definitely a must! Bet your right about the 20% vs 1/20th!
Jim, I have bee trying to lease 840 acres since oct 2012. I’ve been actively contacting companies with no luck. I heard this week oil flow seems to decrease fast and they have all the permits they can work for a while. Not good news for owners