So recently I inherited my fathers mineral rights in Lea county NM. I don’t know a lot about this it is quite confusing. I believe he had 1,120 acres of mineral rights. I was recently contacted regarding a lease he signed 3 years ago. The company is opting to extend the lease for another 2 years so they needed to get some info from me. I was told they are planning to build a new well in the near future. The areas in regard are:
w/2 w/2 of section 1, township 18 south, range 38 east
all of section 2, township 18 south, range 38 east
s/2 of section 3, township 18 south, range 38 east
Is anybody familiar with this area? Does anybody know if there is activity in this area? Is this a good area? From what I have been reading it seems like it might be good. Any thoughts or insight would be greatly appreciated, thanks!!
Welcome aboard Gregm, you certainly are at the right place. Not so long ago I was as stupid as they come, trying to find out stuff about the same area! With a half dozen sites in Lea County, I still get more informed every day from the intelligent people on this forum who generously share their knowledge.
Like you said, you’re new to this, so if I say something you already know, just disregard it. If the company is opting to extend the lease, and you have sent them all the info they asked for, then you’ll get the additional bonus payment for the extension. That price is not negotiable though. It’s something that would have been decided on when the lease was signed by your father. If they extend the lease, but don’t drill within the option period, then your lands will be available for someone else to lease within about 2 years or so, depending on the terms of the lease.
As for activity, you can look around on this site to see what production is going on in the area surrounding your lands. Sorry I don’t have time to look for you right now.
I recommend asking for a copy of the original lease if you do not already have one. Standard extensions tend to renew at the original lease bonus that was agreed to but sometimes there are terms that allow for bonus negotiation on an extension. Something to check.
As for the sections where you have interest, it looks like several old plugged wells with no new permits listed presently. Here is a link to an OCD well search for Section 1: OCD Permitting - Wells
Good luck with the lease and learning more about you inherited interest!