I have an offer for $300/acre 22.5%ri 3year primary with 2year option(this seems too long)
in Borden County, TX
sw/4 section 44 block 25 borden county, tx
Anyone have any feedback for me?
I cannot comment on the amount since I do not have acreage in that county, but I do not do an option as that is too long.
@Geoffrey_Don I can’t speak to the amount. Pretty much all Oil and Gas leases have a standard 3 year primary term. Options can be an easy way for you to pocket some extra cash if a well doesn’t get drilled before then. It is easier for companies to pay an extension bonus (booked as a Lease Operating Expense) than it is to pay for a new lease which comes out of the capital expenditure budget and can vary greatly from year to year.
Hope this helps.
This topic was automatically closed after 90 days. New replies are no longer allowed.