In Leon County some of these new Deep Bossier or Haynesville wells have a cost of about $20 million dollars or more. These units are around 2,000 acres or so. At an average cost to lease of about $500/acre x a 2,000 Acre unit = $1,000,000 leasing cost for the unit. That’s only about 1/20 th of the well drilling cost.
There are legal and research costs to leasing, not just a bonus. If you owned the entire 2,000 acres, they might only need one landman and one lawyer, but if there are 50-500 heirs and owners in that 2,000 acres? You need a few more columns of numbers, landman/research/legal before you can compare a lease bonus cost and a completed well cost. If I had 2,000 acres, I would ask for more money.
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If a person only owns say 10 % of the minerals on a track and the average price of the lease bonus/acre is $500, then each person is not going to get $500/Acre of the entire track.
Forgive me but it seems something is missing here, like the point you are trying to make? You started out comparing $500 per acre bonus to a 2,000 acre $20M well, without giving numbers for landman or legal services which can be very high these days.
Also, If I were leasing? I would want them to make the well the most productive possible, with the most frack stages, the best and most proppant. I’m often disappointed that my wells aren’t More expensive! Even though I’m paying my portion of the drilling costs. When you are leased, you want them to spend a lot on the well. You wouldn’t want them to drill a cheap well that leaves more oil in the ground than might have been?
Remember, the money is in the ground. Once you are leased, a cheap minimal well is one of the worst things that can happen to you. Try to look at things from all sides.
That is WHY I get a minimum royalty clause in the leases! You are not going to HBP my minerals for $10/year! I want to lease the minerals, NOT DEED it to them.
Any clause is only as good as your lawyer and the depth of your pockets.
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