Early March an offer came for $ 150.00 @ 3/16, $200.00 @ 5/32, and $250.00 @ 1/8. I have interest in 12-10-10 and 2-10-10 in Caddo county OK. Today they came back with $ 400.00 @ 3/16. the last lease was in 2017 and very substantial. Has there ever been a clause in a lease that would not allow a flip? Has anybody ever seen offers go backwards ( 5/32, 1/8 ) ? I want to find an Attorney around the area but I don’t know who to choose other than just pick the first that comes up in a search. The offer was for 12-10-10.
Current offers are based upon competition at the time, so any earlier lease offers were competitive in their time frame and do not relate to today. You can put a clause in not to flip, but that may make your acreage less desirable.
You can query the state bar association and look up oil and gas attorneys. You may have to try several due to conflict of interest situations.
following up on what Martha said, you can negotiate a clause that says that the lessor/ mineral owner has to give consent to assign the lease. However, unless you are in a very hot area and own a substantial amount of acreage in the section, the company will not accept your offer, and will pool you when the time is right. Do offers go down or go away? Oh, yeah. A few years back, a company approached a family with a bunch of acreage. Offered the family $500,000 for the lease for the entire acreage. The family hires an individual to negotiate on their behalf. It appears the negotiator was promised a percentage of the bonus above what she could get above the initial offer. She made a ridiculous offer and didn’t come down much. In the meantime, company drills two very marginal wells and decides to condemn the area. Company goes radio silent and never leases the family.
Rules to be aware of:
- Prices can go down.
- Oil and gas prices can go down.
- Just because the offer is small, doesn’t mean that its going to get better.
- If somebody offers you $500k, tackle them before they leave the room.
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Thanks for the information.
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