Martha, & all: A rep of Continental has offered to renew a lease on acreage in Sec.3, 1S, 5 W. He’s offering $750 an acre with 1/4 royalty. He claims Cont. plans to drill “soon”. Your opinion, please. My lease isn’t up until April of 2020, so I’m wondering why this offer so far in advance.
QUITE a bit of activity in that area from quite a few players. Horizontal wells are planned. Sections 4 & 5 and many more already have OCC cases pending or already ordered.
CLR wants to go ahead and tie up your acreage and it get it off their “to do” list. Do you already have a 1/4 lease? Personally, I would ignore them until your lease expires. Now is a good time to review that lease and see if it has the clauses that protect you. If you signed the original lease that they sent you, it probably does not have mineral owner friendly terms and now is a good time to research better ones.
There are no pending cases filed for section 3 at this time, so they may not be able to drill before your lease expires in April. There are many other companies leasing in the township, so you may be able to get a better lease after yours expires. I am not a fan of top leases. You may get some offers to do that. I just let my leases expire and then get a new one. The $750 and 1/4 is a good starting point, but time will tell if the offers go up. CLR just pooled Section 5 for $500 and 1/4, so your is better for now.
Do you have an extension clause in your lease now? If so, then you are pretty stuck and you cannot lease with anyone else. If not, then I would wait for the lease to expire. If you have that extension clause, then you probably cannot change the terms of the lease. If you don’t, then you can negotiate.