Is it true that Continental and QEP Resources are offering $50,000.00 per net acre? Heard it from a stock broker friend. Anyone know for sure?
That sounds more like the price per square foot in Manhattan real estate. (X 50)
It's more than unlikely that any co. would pay that kind of bonus, unless it was some type of extraordinary circumstance, but I can't think of any. Well, I guess I could, but it simply wouldn't be cost effective.
CHK was the first co. that I know of personally, that really started inflating bonus monies for oil & gas leases. Probably in the Haynesville. You mentioned a stock broker friend. Ask him how CHK stock has performed in the last few years.
The best thing to do would be to go back to your friend, and ask him to support what he told you. Ask him to show you something that proves up the gross and net acres covered by a particular lease, and a copy of the check or draft, or whatever was used, to confirm that $50,000.00 per acre was ever offered.
Be more like the guy or girl from Missouri. Next time someone outside of the oil business tells you something, make them "show" you. Otherwise it rings hollow, and shouldn't be taken seriously.
You are so right. Anything that sounds too good to be true etc.
Dave Quincy said:
That sounds more like the price per square foot in Manhattan real estate. (X 50)
It’s more than unlikely that any co. would pay that kind of bonus, unless it was some type of extraordinary circumstance, but I can’t think of any. Well, I guess I could, but it simply wouldn’t be cost effective.
CHK was the first co. that I know of personally, that really started inflating bonus monies for oil & gas leases. Probably in the Haynesville. You mentioned a stock broker friend. Ask him how CHK stock has performed in the last few years.
The best thing to do would be to go back to your friend, and ask him to support what he told you. Ask him to show you something that proves up the gross and net acres covered by a particular lease, and a copy of the check or draft, or whatever was used, to confirm that $50,000.00 per acre was ever offered.
Be more like the guy or girl from Missouri. Next time someone outside of the oil business tells you something, make them “show” you. Otherwise it rings hollow, and shouldn’t be taken seriously.
In N.Dak. could be purchase not lease, still a lot of money.
Or maybe your friend misheard or misinterpreted a $50,000.00 total bonus as $50,000.00 per NMA. $50k/acre would still be very high to purchase unproducing minerals anywhere in the country, IMO.
Like Dave Quincy said maybe they were confused and were purchasing Manhattan AGAIN!
"Texas Tea" has the likely answer. It's probably confusion over a bonus of $50,000 paid in total rather than a per acre amount.
Even in a "sweet spot" in the Bakken, and even if minerals were being sold rather than leased, they would not be purchased for $50,000 per net acre. The high water mark thus far is well under half that amount. If I'm wrong, I've got 10 I'm willing to part with to pay off the house and put the kids through college. In fact I might sell 'em all at that rate. :)
Mary, that sounds like it could be a deal between companies, for a proven area that already has wells producing and the capability to support more wells, so they wouldn't just be buying acres but alot of value added in the form of producing wells, infrastructure and possibly a drill rig thrown in, which is not calculated in the per acre price. KOG made such a deal for many thousands of acre last year [ including drill rig and producing wells ] for 600,000,000. The per acre price neglecting all of the value added would seem staggering, but misleading.
Hey guys, thanks for all the possible explanations , it certainly sheds new light on things. I was thinking maybe it was that big “gusher” north west of Watford City.
Mary, there are more than a few big gushers around Watford City. It's a good area and there are alot of infil wells being drilled, just not on my 27 net acres yet.
This is Dave Quincy's attention to detail. Anybody see mention of lease bonus in the OP?
Dave Quincy said:
That sounds more like the price per square foot in Manhattan real estate. (X 50)
It's more than unlikely that any co. would pay that kind of bonus, unless it was some type of extraordinary circumstance, but I can't think of any. Well, I guess I could, but it simply wouldn't be cost effective.
CHK was the first co. that I know of personally, that really started inflating bonus monies for oil & gas leases. Probably in the Haynesville. You mentioned a stock broker friend. Ask him how CHK stock has performed in the last few years.
The best thing to do would be to go back to your friend, and ask him to support what he told you. Ask him to show you something that proves up the gross and net acres covered by a particular lease, and a copy of the check or draft, or whatever was used, to confirm that $50,000.00 per acre was ever offered.
Be more like the guy or girl from Missouri. Next time someone outside of the oil business tells you something, make them "show" you. Otherwise it rings hollow, and shouldn't be taken seriously.