Richard Main map updated.
Tica,
Oklahoma Tax commission.
I believe you have to submit a written request for the info or access it from a 3rd party paid subscription.
Pamela,
The leases are written in favor of the oil companies, we have to ask for everything.
Without a Depth Clause, the oil company has rights all the way to China. If another formation is found under the Woodford, ie Hunton they have the rights to drill the Hunton. With a Depth Clause, a lease could limit the oil company to the Woodford formation and you could lease to another company for the Hunton formation or any deeper formation.
As look for GROSS PROCEEDS and not NET PROCEEDS. Also you want to get paid for the price AT THE WELL HEAD. This should prevent the company from selling to a subsidary at a lower price, which would be what you would get paid, and then have the subsidary sell it at market value.
If you can do not have a OPTION TO LEASE clause.
If they offer you a nice bonus at 3/16, try to get less bonus and 1/5 royalty. This will cover the ‘loss’ bonus over the life of the well.
You do not want to PARTICIPATE IN A WELL, which means you are paying for the drill cost etc.
Look out for the oil company passing operating cost to you such as DELIVERING, PROCESSING, COMPRESSING, and MARKETING.
Daniel,
A shut-in clause and a pugh clause are also desirable.
A pugh may be irrelevant if you have a small acreage in a single tract. With the current 640 acre spacings we are seeing, all the included interests in a section will be held by production anyhow. However when you are leasing, you don’t know what they will do to hold production.
I don’t think you will ever find participating offered as part of a lease. That will generally be an option only when there is no lease and you are force pooled.
Sorry, Pamela…I don’t know anything the depth clauses. We’ve never done anything like that. These guys on here seem to know what they are talking about so maybe they can help you.
Rick,
Here is what the OCC said at the conferende in Phoenix
Pugh Clause
Also referred to as a vertical depth clause or horizontal release clause.
It is a clause in an oil and gas lease that releases non producing acreage or zones at the end or the primary term or other specified period of the lease.
Under the clause, unproductive or untested zones and acreage that are outside a producing spaced unit must be released back to the mineral owner if drilling or exploration does not occur by the end of the specified time.
wow! Thanks guys for all that great info! Sounds so complicated-maybe need a lawyer to handle it?
Linda, thanks for the info! We’ve been hearing about “depth clauses” also. Is that pretty common these days or do you have to ask for that to be in the lease?
Thanks Rick, I got letter that Newfield had application to be heard concerning Sec. 28 3N 4W in Tulsa
on Oct 1st. Don’t know results of hearing, maybe you do.
Hutch…If you read this note of Richards…this is the same Section we were talking about on the other. Did you say what you read said the hearing would be Oct. 17th? Did they delay it?
Correction: "on the other discussion group "(Stephens group but about Garvin Co.)
I have mineral interests in 28-1N-3W which sounds close to 28-3N-4W…should I be leasing this (I may have but what if?) and I also have an interest close to what you all are calling the Mashburn (I have 33-1N-3W and Mashburn is 33-3N-4W…again is that close to my interest and should I be getting lease offers or is it way off course? I am excited reading the Continental article about the new area that is hot…I have interests in all four counties I just hope they are in the right areas…it is looking that way…but with my luck my areas are alread held by production but wouldn’t I finally get a royalty if they drill and spill?
Elizabeth,
Those areas are about 14 miles away from each other. So that depends on what you call “close”.
1S-3W is the far NW corner in Carter Co. 1N-3W will be just above it.
I think you will see some of the lease offers increasing on anything falling in the “Scoop” area!
pg 3 and 4 at this link shows the coverage.
http://media.corporate-ir.net/media_files/irol/19/197380/CLR_Sunday…
Rick, these are Garvin county descriptions not Carter or am I confused abut your answer that they are close to Carter county rather than in the far NW corner of Carter county as you stated?
I used the maps Rick is talking about until I found the Oklahoma DOT maps here:
http://www.okladot.state.ok.us/hqdiv/p-r-div/maps/2003county/index.htm
Daniel,
Here is another set I have found useful.
http://www.okladot.state.ok.us/hqdiv/p-r-div/maps/control-maps/inde…
Richard… I think it’s a WHEN not an IF. I believe they are going to start drilling soon, especially on 28. They may have to wait on a rig to get loose but I believe they plan on drilling on both soon.
http://www.okgenweb.org/okprojects/township-index.html
Elizabeth, print a township map (or two) for yourself from the link above, it will help you see things. each township is six miles by six miles so the difference between 1N and 3N is going to be 12 miles.
They are making the leases much more detailed now that ours was. I wouldn’t have known what they were saying anyway. They need to speak English or Splain themselves! lol