I have two small, undivided interests in surface and mineral rights in Reeves Co. They have been leased 3 times over the last 10+ years with a fairly consistent stream of inquiries to buy. The two properties are: Section 12, Block C-17, A-1614 and Section 4, Block 70 A-1615. My interests are small, 10.66 acres surface and mineral rights in total. The leases were standard 3-year term agreements with a 25% royalty. The two most recent leases expired in February this year and to my knowledge, there is no activity on the land. I am not interested in selling, but I am surprised that there has been no interest in re-leasing or purchasing in the intervening time. I called the landman that we worked with on the last lease, and he said there was no activity in the area. That may be true, but from what I read here and see in other sources, doesn’t seem to jive with that. Can anyone give me some insight into what’s going on?
You are unfortunately mostly surrounded by dry holes and P&A wells. Most of the old wells were just gas and those commodity prices are not your friend right now. The good news is that there are four 2 mile lateral wells permitted a few months ago by Tarpon Resources a section over in Section 2 of Block 70. They drilled a 2 mile gas well south of the permitted ones last year. Hope this helps.
Thank you Kendall. I realize our location is poor, but that part of the equation hasn’t changed. The commodity price is probably the culprit at this point. Seems like activity continues to move in our direction and I hope we can at least get some interest in leasing in the not too distant future.