Elli:
What Township/Range and who is paying that kind of bonus/royalty in Wilbaux County? That sounds more like Mountrail County ND rates.
Rod, I’m familiar with Wibaux County and offers really depend upon your location (Township & Range). The interest by Lessees varies in relation to where your minerals are. In general the interest is: North end= hope of an Elm Coulee Bakken extension, Middle= Red River prospect, South end= possible Cedar Creek extensions or Red River prospect. Though this is just a general overview of the county.
I agree with much of what’s been posted. However, some comments seem a little misplaced. To date Wibaux Co has not been part of the Bakken play, nor has there been much activity. Both of those things can change. Yet for now Wibaux is a wildcat situation on the fringe of the very active Bakken play. As a result, any drilling is likely to be well down the road (so Lessees want at least five years), and outside of the Cedar Crk Anticline there is no real production (so Lessees offer $100 to $200 rather than $1,000).
So I’d suggest one of two options; 1. Sit on your hands for two years and either offers will increase or go away entirely. 2. Or, negotiate with HERCO for better terms (Ask $250, 3/16th), and be willing to meet somewhere in the middle. Finally, if you haven’t done so yet, post this over on the Wibaux Co. page of this website. That may generate more info for you. That is my two bits. Good Luck.
Has anyone heard of Kraken Oil & Gas LLC?
My siblings and I have been approached by them, and I am trying to learn about them, as well as validate how good the offer is. We have been stung once, and I am trying to avoid a repeat, but cant’ find anything to backup this company.
We have a little over 2,000 acres in Richland county, south of Poplar but they are only looking at about 1/2 of it, in the T26N-R51E area. I don’t see a lot of activity in the immediate vicinity, but looks like it’s moving into that area.
Its the section north off the lost highway closest to the MT ND border.
I will see if I can get the name of the company.
Seeking advice for my 83 year old mother. My mom got an offer from BH Grace to lease her mineral rights for 59 acres in WIBAUX county, Montana. The land is located in Township 11N - Range 58E, Sec 24: N 1/2
and Township 11N - Range 59E All of sections 26 and 27. They are offering her $50 per acre plus 15% on a 5 year lease. Mom has asked my advice and I know NOTHING about this subject. I did dig through some of her old papers and found that another company gave her $75 per acre back in 1996 so this offer seems very low. I would certainly appreciate any sage advice from those of you who are more knowledgeable about this subject. Thanks in advance!
Hi Mary, We were made the same offer by the same company a month ago. Our mineral rights are in the same general area. I made an attempt to contact them and learn more about the company. I could find nothing via the normal channels (Google, phone directory, etc) I do know they are in Dickinson though. I also know that their offer is very low. It should be more in the $100-$250 range per acre with royalty closer to 18%. If you read the responses below you will see my query about our offer from a different company and then all the very helpful responses. Good luck.
Mary, Howard, Rod:
I am not familiar with BH Grace LLC, but they sound like a company who is persuing leases at rock bottom prices for a long term (5 yrs), as this will allow enough time for some development in the area. Once this development occurs, they will sell the lease for a profit. My advice to all would be to hold off any lease negotiations at this time and wait for one or two years to see what takes place. When development begins to occur, your bargining power will be much stronger and each of you will profit from what BH Grace is trying to accomplish. This same scenerio occurred to me back in 2004 but I was not aware at that time on how this industry works. Good luck to each of you and hope your decisions become profitable.
Hmmm, so should I attempt to contact other companies? If so, which ones are offering the more favorable terms in this area? What is HERCO? (please forgive my ignorance) Thanks for your responses. I’m treading on very unfamilar ground here!
No problem Mary. I’ve only learned what I know from participation in this group. Everyone has been very helpful. Anyway, Herco is out of Billings. The’ve offered $100 and 14%. I’m not sure about the protocol of the leesor contacting the leesee. Haven’t had to worry about that. Maybe Howard or Eastern MT could shed some light on that. Hang in there.
Also be sure to inform all gas/oil companies that you are talking with multiple companies - so they will realize they are in a competitive bidding environment.
Yes Mary, but does your Mother need the money today or want to build the best opportunity for her heirs? If she needs the money or would act on the money today then of course, make a deal today. But regardless, in general, don’t rush or feel that the first deal is THE DEAL. Not necessary to wait 2 years (although might be better or might be a dead play - who knows). The choice of leasing and for what terms is a personal thing and varies by each persons unique circumstance. However, if there is time, then take your time and learn as you are. I always encourage people that once they have leased to no longer ask “what if”, they when they lease be happy with the decision and look forward to the possibility of having a well some day. Keep in mind that a small percentage of landowners get the opportunity to lease and of course an even smaller percentage get a well and royalties.
Good luck, Wilson
Thanks Lori. I really appreicate it!
Mary,
BH Grace LLC is a small non-operating company. I also received a similar offer within the same area from Petro-Hunt. These offers are very low compared to other regions.
Tom, in 2006 we had been offered 17% and 100 per a really. Now the government of Saskatchewan offers 5%. Since we can’t compete with that any offer would be good. You are over the boarder from us, but it sounds fair.
Lori, I have a couple more questions. Was your offer in 2006 from the government or a private leasing agent. Also was is it “free of deductions”?
Thanks, Tom
Thanks Rod…so does anyone know the protocol for approaching a different company…or is this like the high school dance…ya gotta wait to be asked?
Typo there… 100$ per acre. I’m on a phone.
Can anyone help with this one in Manitoba? We have been offered 75.00 per acre bonus & 15%-free of deductions. Minerals are in Daly-Sinclair field. The target would be the Bakken. Thanks, Tom
Oh, wanted to add, at 83 I doubt my mom will be willing to wait and see for a couple of years…she’s at that stage of life where she believes that gratification postponed may be gratification lost forever. She’s pretty healthy and sharp but at her age she sees every day as a gift…beating the statistics so I’d like to find a suitable deal for her sooner rather than later.
Mary, Just like the girls don’t wait to be asked at the dance any more, you don’t have to wait to be asked to lease your land.
However, there does appear to schools of thought:
a. one is that if you approach them then you must be desperate and as such you won’t fair as well.
b. the other is, you ask as many people/companies to consider your mineral rights as possible. This develops a bidding war.
I subscribe to option b. I would also use websites like this to get ideas of offers in the area (term length, royalty, sign bonus etc.). Also, talk with neighbors to see what they have heard and learned. Also learning about what has happened in other areas that have boomed can give a hint of “what could come” when you’ll learn of leasing starting at $50 and at some point (even years) reaching $5,000 per acre. The other way to get a better lease is to form a land group there is power in numbers (number of landowners and of course size of acreage).
But as far as protocol approaching others; I’d say do all the research to find out all companies active in the area and then get a contact number and call them. Simply tell them you have xx acres of mineral rights in xx location and you know there is leasing taking place and you are presenting your minerals to ALL interested parties.
Good luck.
Wilson