8-01S-05W Stephens County, Ok MK & P Energy LLC obtaining Oil & Gas lease interest within the Stack and Scoop Plays the offer says. Option One Bonus consideration $1,750 per net acre for 3/16th royalty Option two Bonus $1,250 for 1/15th royalty Option three $1,000 for 22% royalty all 3yr terms Any insight greatly appreciated!!
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Welcome to the forum.
If this is your first time to lease, then it would be good to get familiar with what it entails. The Mineral Help tab above is a good start. There is a small book called “Look Before you Lease” by Jim Stafford that is a bit old, but a good primer for definitions. The draft lease you received is likely not in your favor, so contacting an oil and gas attorney to assist in revisions is very wise. MK&P is not the only company leasing in that section. The clauses in a lease are very important and can hold the lease for decades, so very important to get them right and more in the mineral owner’s favor. If you cannot get the terms that are more protective, then many of us wait for the forced pooling which also has advantages. Many of us prefer the highest royalty as the long term benefits from a higher royalty far outweigh the smaller bonus (in many cases), You do not want any post production charges and most draft leases have that in there. Can cost you quite a bit on money in the long run if you leave that clause in there.
Thank you so much for your response. This forum has been so insightful. Unfortunately this isn’t my first lease and no doubt I have made poor decisions for lack of knowledge. Like many others I inherited my minerals. I regretfully agreed to close 2 plus yr probate on my parents estate without having the minerals interest brought up to date which was advised to me by my attorney. Probate just stated an amount in which the value of precent and that precent would be divided between my sister and myself. Letters were sent to all known lease holders I received division orders etc…. Over the years I’ve tried to educate myself on the subject but its all foreign language to me. I’ve tried to seek advice so many times but have ended up overwhelmed and discouraged. I know not all interests got transferred into my sisters or my name so I’m trying to figure out best way to go about it all. If you have anymore advice for me I sure appreciate your insight! It’s such a relief to have you to help us less knowledgeable folks. Thank you
It can be overwhelming. I, too, inherited and have spent the last ten years learning this end of the business. My other 30 years was a geologist on the drilling and production side. So it was hard and I even know the business! I learned a great deal from joining NARO, the National Association of Royalty Owners. I went to conventions, took courses, etc.
Right now, you probably need a good OK attorney to help you get the minerals properly distributed into each of your names based upon the probate. You might do some hunting on the website www.okcountyrecords.com and see if your parents’ names pop up. You can also hunt in the unclaimed funds for OK (or the state where they resided.) I still find loose things there.
In most final probate orders there is a provision that distributes property that was omitted or unknown at the time of the probate in the same percentages to the heirs. Thus when new interests are found a simple affidavit usually is sufficient.
This post is not legal, investment or tax advice, it is for discussion purposes only. Reading or responding to this post does not create an attorney-client relationship.
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