Hello All
My family has recently been contacted by Point Energy with an offer to lease Blk 34 Section 75. Curious if anyone else in the area has been contacted? Compared to what we were being offered in 2017/2018, their offer is very low per NMA.
Just wondering.
Thanks!
Tony, We have 60 acres of minerals in sec 34, Blk. 34 and were recently contacted by an independent landman working for Pioneer (Exxon). Not sure how close we are to you but apparently they are putting together acreage for a play in the Barnett Shale. I haven’t received an offer yet, they are checking title to see if we may be HBP by an old lease held by shallow wells (our interest is below 3,400’). Just curious what we’re they offering?
Section 75 is pushing the basinal limits of the Wolfcamp. Hence the low offer. Decent amount of risk bearing on the lessee in this instance. Woodford/Miss is still very TBD and highly risky as well due to depth and pressure.
Thank you matt2e,
We’ve been told that before, that is about being on the fringe of the play. Rather disappointing to hear as a mineral owner. My question….
Have the means that Geologist use to determine what’s under the ground improved significantly today? Reason I ask, back in 2017 we leased for 3 times the amount per NMA than what is being offered today. 
. Of course I realize there are no doubt many factors that play into any offer. The price of oil #1. Guess we will see how it all plays out.
I think we are much more confident with the fringe boundary now. We drilled the Tilden and Eclipse pads at Forge which were about 3 miles northeast of you. Tilden were fine but at Eclipse we had a steady curve we drilled up as we came out of basin. H2S is the biggest problem on the fringe and it is pronounced on the eastern boundary. Notwithstanding, there is probably deep potential there as Exxon has kept most of its deep rights in that part of Blk 34.
Thanks for your input. This can be valuable for forum members.
Sorry for delay getting back to you.
Their offer is $750 per NMA 5 year term plus 2 yr option to extend with 25% royalty.
Thanks Tony. Good information. I looked at the RRC GIS and turns out we are about 5 miles east of you and probably similarly situated in the basin with regard to the Wolfcamp. Hopefully the Woodford and Barnett shales hold promise.
Tony, several companies have taken a position to expand OGL acreage during the low product price period by offering extended lease term, lower bonus amounts, and lower royalties. The 5+2 and $750 will fall into this methodology. With prices increasing, you may want to consider waiting or making an aggressive counter proposal.
Personally, three year term and no option are a better time frame.
Thank you to all who’ve commented. I appreciate matt2e for the insights from their experience in our area here. It only makes sense for operators to develop the best acreage first, but with section 75 lying in the middle of the Permian, surely there are minerals beneath to be explored. I suppose time will tell if, when and how it happens.
Tony I wanted to let you know that it turns out our minerals in Sec 34 Blk 34 were not HBP and we were able to negotiate a lease at $5K per acre for 3 years, 1/4 royalty with Pioneer.
That is a great bonus number and royalty. Is this a cost free lease?
Yes Rock Man it seems like a really good deal to me. From what I was able to determine from the landman, Pioneer/Exxon is looking at the Woodford and Barnett shales in the Block 16 Ellenburger Field. Apparently Exxon has a lot of deep rights in the field. They indicated it would be a couple of years before they start development.
My sister and I recently inherited land/mineral rights in Sec 51, blk 34, so are gathering info. Is anyone familiar with this area of blk 34, and any activity that may be occurring in this area? Thanks.
Depending upon your location in the section and the spacing of the wells, there is a horizontal well by SMC Oil & Gas Stallings Gas Unit 2H on the west side of the section. Earnest Producing has the Stallings , B. M. 2, Stallings, B. M. 1, Stallings, B. M. 5 on the east side of the section.
Did you inherit any files from the ancestor? You will need to contact both of the operators to see what you need to do to get into pay. Also check the TX Comptrollers office for any escheated funds.
This is such helpful information. Thank you!
My sisters and I very recenlty leased 60 acres of minerals in Section 34 Blk. 34. Our tract is 2 miles southeast of your property. Your interest may be HBP (held by production) from the existing wells that appear to still be producing. However based on what we were told, Pioneer Production is looking at developing a couple of shale formations (Woodford and Barnett) in this area. Continental Resources has a drilling permit on a Woodford shale test approximately 2 miles north of you. If you are not familiar with it, check out the RRC Public GIS Viewer where you can zoom right in on this area to find all kinds of information. Also there is a tecnical report “Block 16 Ellenburger Field, Ward County, Texas” available online which shows that your property, like ours is within the mapped closure of the field. The report was authored by L.E. Monley and R.N. Mercurio who were both employed by companies that were developing the field. Good luck to you and your sister and here’s to hoping we both see new development in this area.
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