Melodee, the DO’s come out about five to six months after the date of first sales, so you should be fine. You might want to contact the royalty department of Newfield directly since they will be paying the royalty. You can find it online.
That you so much, Mr. Barnes. I will write Newfield today!
John,
Find out the title path and why they think you have mineral interest. You will need that information for your files. Tell them that you want the paragraph from the title opinion that tracks your interest. If it comes to options and choices about what to do, friend me and I will walk you through it if you have never done it before. Sometimes those guys come on a little strong and don’t tell you about other options that you have. Also, don’t let them rush you to make a deal.
Chesapeake had a well in there already, so you need to find out if you are due some past royalties. Will depend on the title search and the timing of the last production of that well versus your “ownership”. Newfield is active all around you, so Payrock may only be the leasing company. Time to be a detective!
John, if you have never been a working interest owner and this is all new to you, that is probably not a wise idea. Leasing is better if you are just starting out. WI has some major legal and accounting consequences which are not for the newbie. Great for some folks, but not starting out. Do you have 1.5625 acres? or %? Did they offer to lease? What were the options? Did you inherit the WI? Get a bit more info before you answer.
Mr Barnes, I have a call into the land man, Abe Henry, to get more info. I will,let you know if I have more questions. Thank you.
M. Barnes/John. I have a similar situation where I had a Working interest in a well in 4-14-6, Canadian county. Payrock got a forced pooling which I declined to participate, of a whole section including my working interest well which was still producing. They then drilled a new well or may have been in the old hole and produced and are still producing from it in a fair amount. They sent me a check for $1.02 upon it’s completion back in April 2005 and I have not heard from them since. What should I do now? It would seem to me that they should owe me some monthly income as they did away with the income I was getting from the first well?
Samantha, please abide by the rules of the forum. No solicitations are allowed on the county forums. The MKT PLACE tab at the top is better suited for your offer.
I suggest you contact Payrock and see what is going on with your interest. If you declined to participate as a working interest owner, then you were probably force pooled anyway. There is a new horizontal well in the Woodford. Your earlier well was probably in a shallower reservoir. There is supposed to be a second well, so you better get this straightened out. If you have your owner number from the check you received that will be helpful. They should have sent you a division order for the new well.
John R, I think what you mean is that you have mineral rights with the right to lease. You can either lease with an offering company or wait for Force Pooling which is also a type of lease that is for six months to one year. If you do not want to mess with the hassle of working up a good lease, then FP is a good way to go. In a FP, the operating company will offer a set of royalty/bonus options. You will have 20 days to answer or you will get the worst option. They are supposed to offer the best terms of the contiguous eight spacing units that touch your area. If horizontal well, then the eight sections surrounding your section. Do not go for the 1/8th option. I usually try for the 1/5th if it is offered.
This helps and I think we will wait for the pooling . He did say that we had a Lease Holding , That was what confused me. He gave me a company Raf Oil company and a number 567339 Lease #1 and also the book number 544232 in 1976.
My father was working with some drilling companies at the time and invested in them, could that mean we had a property that this company had and we were part of that?
Thank you for your help. I live in OKC and not that far of a drive.
Mr. Barnes, I have discovered that on the property we discussed earlier is that we have Lease Holdings. Can you explain this in relation to mineral rights. Does it have a less per acre bonus and or does this work the same as mineral rights? they are going to court soon to pool and they are asking only $400-$500 per acre.
John R- It may mean that you are held by production (HBP)according to that Lease and you will not get the force pooling options or a chance to lease now. You will get royalties from any new wells. But they will be at the terms of the original lease. This is not unusual. I inherited properties that are held by a lease back to 1919. Not very favorable terms, but kind of cool that it has lasted that long! Usually they use the term HBP in that case. The info he gave would be the book and page number in the Kingfisher County records to look up the original lease. The digital files only go back to about 1991, so you would have to call the county clerk and find out how to get a copy. If you live in the area, you can go get it yourself for a small fee. It would be important to get a copy to put with your records.
Has anyone received their DO for the REHERMAN 1H-25X?
Location S25/36 16N-07W
Thanks DR
Scott, personally, I never do a top lease. Especially one that only pays you part now and part later. What if they don’t have the money later, then you may have a hassle with the first company and not be able to negotiate with anyone else. What if they go out of business or are in bankruptcy and there is a legal mess you are caught in? It is a risk either way, but in general, the closer to drilling, the lease bonus prices go up, so I usually let a lease expire on its own terms and then negotiate in the market at that time. Yes, you may lose a little, but you can also gain a lot. This business has risk. I know of a family right now, that did a top lease that is half of what the current market rate is. Sometimes, it works the other way. I just prefer to have all my options available to me when the time comes. It keeps the legal situation quite clear of entanglements that way. Just my preference. Do what you think is best for your family. If you need that extra 25% now, just know it has strings attached…
Hey - I have a question but need to give a little background first.
My mom transferred 80 acres of Mineral Interest to me about a year ago that was under lease (no production) with Chesapeake. They had just exercised the 2 year extension that was written in to the lease prior to her doing the quit claim deed. That lease expires Oct 2016.
I just received 2 different documents yesterday. The first notified me that Gastar had bought Chesapeake’s leasehold interests in Kingfisher County. That letter came with a lease agreement offer to go ahead and do a “top lease.” Sign now, get 25% up front, the rest in Oct 2016 when the current lease expires. The lease is double the amount of bonus dollars from what my mom had with the same royalty percent. That seems fair enough to consider…then I open another envelope. This next document is from Gastar and they have filed with the OCC for a 640 acre spacing unit for a horizontal well in my section (cause no. 201506039).
My question is this: Since they have a year to commence drilling operations under the current contract, which from my understanding would put us in a HBP situation, why would they want me to sign a new contract that has double the bonus? It doesn’t make sense to me. Is there a catch? I’m also wondering if I am in a negotiating position or not?
Thanks in advance—Scott
Scott,
Gastar claims to have over 500 potential drilling locations in the Hunton & Mermac in Oklahoma, with more than 60 PUD’s. Best I can tell; they have under five rigs in the area.
They probably don’t know if they can actually drill your acreage in time.
Their first wells came in at producing over 300 Boe/d average over the first 90 days @ 80% oil. Their AFE’s come in between $3.5 million to $5.5 million per well.
If these numbers are true, Gastar’s provided these numbers, then yes, I would say that you can negotiate.
M Barnes & R Story,
Decisions, decisions—ha ha! I am least hopeful now that there is possible action in my area, especially with Gastar’s just released press announcement of their 1,000+ BOE per day well fairly close by. I’m hoping that their Spacing Order request is a good solid intent to drill.
Thanks for your responses!
28 pooled for $1000/ac 3/16ths or $750 1/5, 30 is pending and 29 is not listed for pooling although it has the exception and horizontal parts already done in September 2015 by Chesapeake.
Payrock Energy for 30. Hearing was supposed to be 12/14/15. I don’t see orders yet, but they may be out there…