Oil & gas discussion group for those interested in Lane County, KS. Share your experience regarding lease bonus, royalty rates, drilling activity, and oil & gas news.
Interested in knowing how much is being offered for oil leases at the present time. Have you had an offer? Going rate was $10-15/acre; some are starting to offer a lot more.
I have not had an offer but am curious what a good bonus and royalty should be in this area? What are they going after? Who are the operators?
TC
Paul what are your thoughts on this mississippi play? Why have they all the sudden starting to go north with the leasing? Seems to be a lot of hype without any info. I still don't know what they are offering at this point.
TC
The picture we are getting is that now that leases have gone through the roof in other areas, operators will be focusing on cheaper locations to try to get in on the ground floor. http://superioroilandgas.com/mississippi-limestone-emerging-as-top-flight-horizontal-liquids-play/
You're right, there is the hysteria factor :) Smaller operators have been drilling wells in Lane county for decades with moderate success. But the potential of horizontal drilling has changed the picture. Hope it also changes the reality once they start putting some wells down.
I have heard of $150-$200 per acre, 3/16 royalty and 2-3 year extension. It has gone from $30 to $200 in about 1 year. Don't know if these numbers are county wide but there is a lot of action.
Ron
Yep, $200 is the new reality, Ron. Some folks believe the good Mississippian horizontal drilling prospects roughly encircle the Hugoton gas field. The Kansas action started in Barber, Harper, and Kingman counties, and then moved NW to Ford County. Now the Western counties along Highway 96 are getting attention.
I heard today of an offer of $250 bonus for a 3-yr lease with 3/16 royalty +$300 bonus for a 2-yr renewal. Sandridge and Encana are both trying to lock in properties in Lane County.
Sandridge, Encana, Apache, Cheyenne/Tug Hill, Scout/Larson, are the major players in Lane County. I haven't seen Noble yet. Yes prices are starting to creep upward to $200/acre 3-2 3/16th.
Schonwald Land from Oklahoma City just completed a lease with us and were very good to work with. Osage Oil & Gas Properties from Oklahoma City also leased from us and have been good. Both at about $200/acre w/ 1/6 or 3/16.
Ron, Schonwald has been trying to get us to sign. Have they paid you your bonus yet?
Yes, Schonwald checks came in with no delay from their projected pay date.
Ron, thanks. Glad to know it's working out for you. Larson just contacted us again about leasing several quarters for exploration with a view toward tradition vertical drilling. Of course they are not offering what Schonwald is.
What part of Lane Co. are you located? We are in SE part. We are expecting check from Osage any day and they sound like it is for sure.
Both Schonwald and Osage are planning horizontal wells, at least that is what the offer has been about! Larson has been active in Lane Co.
Ron, Paul is married to my cousin, Teresa Hineman Koehler. Their lands are in same general vicinity, SE Lane County. We both have been negotiating with Schonwald but are frustrated by the slowness of the process. Larson/Scout are wanting to put together a seismic shoot, but if Schonwald would get serious, that would be a better deal obviously.
We have had no trouble with Schonwald at the $200/acre, 3/16 royalty. Maybe we signed just in time, they can get a lot of lease money out there at these rates!
I just had a conversation with the landman we had been working with. He told me he was no longer with Schonwald and gave me a number to call. He related that they were essentially tapped out... that they are just out of money at the moment. Not good news. You evidently got in under the wire, Ron. I could put together seventeen quarters for them, all of it contiguous. Some is available now, and some comes off lease in August. That would be a pretty nice footprint for a horizontal project, especially since Mark and Teresa Koehler are negotiating for property that also adjoins. Rather disappointing, but our time willl come.
Your time WILL come with that kind of leverage toward horizontal. Keep in touch, you have my email.
Don you should call these guys they have a couple of big clients and I think they are from the Lane County area. They have been the best landmen to deal with I've encountered.
OK, we now have the horizontal drilling mentioned above doing fracking and extending electrical service to site. Does anyone have an idea what that means, good or very good?