My family has been contacted recently about leasing in Southern Illinois, specifically White County. Since I live out of state I don't know what all the neighboring property owners have done. Is anyone on this board familiar with the recent history of leasing in this area? What kind of terms and dollar amounts per mineral acre seem fair for that location. We were offered $150 per mineral acre on a five year lease with a three year option. Can someone explain to me what the three year option means?
I met with a landman today representing Woolsey Energy out of Wichita, KS. He was offering $150 per mineral acre for a four year lease with a four year option. If the option is excercised they were offering an additional $100 per mineral acre. The option allows the lessee to maintain the lease in the event that drilling has not commenced. With the size of the acreage they are wanting to put together it will take some time. He said that a test hole was scheduled to be drilled beginning Feb 19, 2012 but he did not know where. The land that my family owns is in Heralds Prairie and Indian Creek townships. Where is your family's property located and what is the name of the company trying to lease yours? Do you own the surface or just the minerals? The landman indicated there may be other producers trying to lease in the county. The landman said they were wanting to drill one well per 640 acres--so it will be a horizontal well in the center of the 640 acre block. This is a bit different than the normal vertical wells that are on 10 acre spacings--so I am not sure what would be considered "customary" or "fair". I have some research to do.
PS He said that they were more interested in the oil than the gas.