Hhhhmmm. Thanks Rick, this stuff is confusing, I'm an artist - numbers scare me, lol. What do you mean by not covered?
The section 15 is part of a pool.
The lLorre Lease lists 22,27 on the stub, does that mean the well is on more than one section?
Here are a couple of documents that might help. The well coverage file shows in yellow what the pool is that the well is producing from. If you own property outside of the yellow, that is not part of the .92 net mineral acres.
Since you have acreage in section 15, it is very possible you have some in the north of 22.
Most of the deeds I have seen filed after a purchase like this are quit claim deeds conveying the entire section to the purchaser. In many cases the mineral owners that did not know what they inherited.
2797-SectionNumberMap.gif (5.73 KB) 2798-WellCoverage.pdf (61.1 KB)
Frankie,
I missed the part of the Joann.
I updated the wellcoverage map. That confimed the possibility of you having areas not covered by production on the Loree. The Joann is in Orange. There is still the NE/4 not covered by production and your NMA in not known on the Joann. I left out 15 on this print
2796-WellCoverage2.pdf (52.8 KB)
Awesome, thanks Rick, I really appreciate the effort. My Acreage on Joann is 2.890625 the payment decimal is .00019531.
Since the lease purchase agreement clearly states that he's purchasing the rights to Lorre and Joann, does that mean I should review the quit claim and make sure there is nothing else listed besides 15, 22, 27 T1N R4W?
Thanks again, you have been a great help, it's nice to know there are good people out there!
Frankie,
There are different things/ways that it could be sold.
You could sell the lease, the production on a well, or the mineral interest of the property. They could be sold in any combination.
Usually a quit claim deed in this case covers everything.
On production pricing, what I have been told is basically 3-4 years of oil production and 5-7 on Natural Gas. The horizontal (Jo Ann) wells taper a bit quicker so you would want to look at where they are in the production history curve. Look at what you had the last year and this 6 months and average it. That is just the well production.
Then you would want to figure out if there was a depth clause in your lease. If so, the rights below 9100 feet or so should be open to lease again adding value.
Next you need to find out what is not held by production in those 2 sections.
In section 15 you need to know how many acres you have and how it is tied up. You said it was pooled. If you selected 3/16 or ¼ royalty, then it would be worth more than if you selected 1/8 and took the higher bonus.
I have neither bought nor sold any. But I have had many offers and watched quite a few sales take place. I’ve also studied about 30-40 older transactions on the property my family has now.
Don, Please chime in and correct me if I’m giving out any wrong info.
I just wanted to update everyone on my status. Thanks to some very helpful individuals on here, I was able to do a little more research and find out my interests are worth considerably more than what I was offered. I can't thank you guys enough for your assistance! I'm now working with a reputable landman in the area who has stepped up for more than THREE TIMES my original offer... LESSON LEARNED!
Pretty scary to think how much I could have left on the table. My advice to anybody else who is naive about this stuff and stumbles across this site - BEWARE, AND DO YOUR HOMEWORK!
Thanks again for all of your help,
Frankie