Owners actually sell royalties while their wells are being spudded or fracked? Seventeen thousand an acre for the Plato looks okay but that is an old well. Will they drill again at this location? Seems to me these are not good prices per acre (except for the Roberts). This does not seem to bode well for oil prices in the future.
There is a business relationship between the buyer of the minerals in Section 16-4N-5W and the Plato well operator. So that suggests to me there will be more wells.
I think all of the mineral buyers got bargains, especially the buyer of the minerals in Section 2-9N-8W. Two wells being drilled in that section.
There is a pooling hearing set for 8/16/22. If the driller is prevails (i.e. granted relief) does that mean all rights holders who have not yet committed to a lease/bonus offer will be compelled to accept a minimum royalty? With two drillers competing does that mean the one who signs up the most acreage wins the right to do the drilling?
The pooling will offer a range of bonus/royalty pairs, not just a minimum. You can pick which one you prefer. Most of us would take the higher royalty as the bonus is insignificant in comparison. The OCC will choose the operator based upon the arguments presented or discussions between the attorneys. Sometimes a second company will file in order to get the first company to get moving. Most of those issues are settled in the hall of the courthouse…
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To add to what M_Barnes said, an Order will be issued setting forth the terms that you get to chose from and naming the Operator. You will have 20 days after the date of the Order to make an election as to which combination of bonus $$ and royalty you chose. If you elect to participate, you have an additional 5 days to make satisfactory payment to the Operator. You need to send your election to the Operator & its address as set forth in the Order and do so via Certified Mail, Return Receipt.
Q: I received an offer from one of the drillers of $1,000 “PPA” and 1/5th royalty. I don’t recall seeing that term before. Can someone explain its use in the execution of oil and gas leases? Thanks
Pre-Pooling Agreement maybe… I signed a PPLA in another section: Pre-Pooling Letter Agreement. Tied to the pooling. I got a 22% royalty that was not offered in the pooling. Could have held out and been dismissed and waited for the 2nd pooling. Those who did got the 25% royalty option in the 2nd pooling.
Hindsight is 20/20.
Not sure, but will bet that PPA is a typo and should be PNA, per net acre.
The landman replied-- “PPA”= price per acre.
Don,
Force pooling, if possible, is the only way to go.
Great to have you. I have been overseas. I welcome any questions
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Re: 31-9N-7W (and 6-8N-7W) I heard there was a “continuance” on the pooling order for this area. Can anyone confirm? If so, is there a date for the decision?
There are three pooling cases for 31-9N-7W which one are you asking about?
2022-0002879, 0002882-Tulsa (Citizen Energy originally on 8/15/22-was reset to 8/29/22-and reset to 9/12/22) and 0002932 (Camino-originally on 8/16/22-I am not finding it as easily on the dockets but would assume it would be 9/1/22)
https://oklahoma.gov/content/dam/ok/en/occ/documents/ajls/jls-courts/court-clerk/docket-results.html
I received 2 notices from Citizens: Cause CD #2022-002599T (Relief Sought: 1,280 acre horizontal drilling and spacing unit) for Section(s) 6-8N-7W and 31-9N-7W Grady Co. (Notice dated July 8th. The other Relief Sought: POOLING Cause CD No. 2022-002879T (notice dated July 28th). Lastly, I have one from CAMINO for Pooling Cause CD #2002-002-932 (Filed July 25th). That hearing was scheduled for Aug 16th.
Reason I ask is I’ve suddenly gotten bonus offers substantially higher than before on top of the same royalty (1/5th). I had previously expressed an interest in signing with someone about 3 weeks ago but have not yet received or signed a contract. Will offers get better in advance of pooling orders being settled? Seeking advice.
The answer: “It depends…” on who is offering. Are you talking about lease bonus or purchase? It is better to get a really good lease with your attorney edits with whomever will accept it at the highest royalty. The bonus is usually fairly small in the big picture of getting good royalties over many decades on one or more wells.
(Reuters) - U.S. Supreme Court Justice Neil Gorsuch on Thursday rejected a request by pipeline operator Energy Transfer LP’s Sunoco Inc unit to block efforts to enforce a $155 million judgment in a lawsuit accusing it of failing to pay interest on late payments to 53,000 oil-well owners across Oklahoma. Gorsuch denied Sunoco’s request for a stay blocking proceedings to enforce the judgment while the company appeals a federal judge’s 2020 decision finding that it violated Oklahoma law by failing to pay interest on more than 1.5 million late payments to royalty owners in wells across the state. Gorsuch handles certain cases for the court from a group of states that includes Colorado.
Just posting this FYI. My family has mineral interests in S23-7N-7W. The acreage is held by production from an old 1/8 lease. Camino has an approved pooling order for S23 and S26. We are getting offers to sell for $6000 per acre. Has anyone seen an application for permit to drill? (APD, that’s what they are called in Colorado, not sure about OK)
Not sure what we are going to do but does anyone have a recommendation for a lawyer based in Chickasha? We may be consolidating and would like some professional advice from a reputable local representative. Martha, if you see this, how can I contact you on a professional basis?
Very common to get sales offers right before drilling. In my experience, they usually start out low just to see if someone will bite. Camino is planning to drill a Mississippian or Woodford well in 23 & 26. Probably start with Woodford and then move up to the Mississippian later. Camino has activity all over that area. Don’t just think that there might be only one well. If the area is good, then they may drill more. That is why you are getting offers. A good old 1/8th lease with gross royalties may be a nice income stream.
I do not see a permit yet, but the cases are still in progress. I see another pooling on Oct 3 for a few stragglers. Permit will probably come after that. You can watch for the permit at the OCC wellrecords site. Here is the link. Look for section 2607N07W or 2307N07W. Test
You can use any good oil and gas attorney licensed in OK. Doesn’t have to be in Chickasha.
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Section 12-6N-7W has had another sale of minerals. 30 NMA @ $19,000 per acre with 20% royalty. That’s up from the $15,000/acre a couple of months ago.
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