Buddy,
On a prospective lease with a company, we have $1.50 per linear foot (not depth) of the oil, gas or other mineral well drilled. The prospective Lessee wants us to either remove the clause altogether or come down off that price. I see by your comment you start negotiations at $3.00 per foot. What’s the lowest amount you would go?
Buddy Cotten said:
Dear 6GT,
Like all lease terms, this is a negotiated position. I do not want the Lessee to use water from my streams or tanks, only drilled water wells that they return after operations.
I try to begin at $3.00 per foot of hole drilled, both in the vertical component and the horizontal component, rather than a metering system. For example, a 10,000 foot vertical leg and a 5,000 horizontal leg, equals a payment to the landowner of $45K.
I would love to hear what other parts of the country are negotiating.
Best, Buddy Cotten Mineral Management