Would like any comments or advice on two recent lease offers received on Sec 17 Township 1S, Range 4W.
One came from a broker NOT representing a driller. My thought is probably looking to flip the lease. Offered a 3 year, 3/16 royalty, $1252/acre. Royalty would be on net proceeds, also a depth clause of 100 ft. below stratigraphic equivalent of the deepest depth penetrated.
Second offer representing Continental Resourses is a 3 yr. term, 3/16 at $1250/acre and 2 yr. extension at 125%/acre bonus consideration. Also comes with depth clause.
My feeling is that I am not real happy with a flipper but like his 3 yr. term as things in the industry may be looking up. Thinking of asking for 1/4 royalty at $2000/acre and go for gross proceeds and eliminating the depth clause.
On second offer, I'd reject 2 year extension, ask $2000/acre and drop depth clause or specify the deepest perforation in the well from which it is producing.
Appreciate hearing comments/advice from anyone in Stephens County.