The lease is for 5 acres in 161 acres of the J. S. Fore Survey containing 80 acres and the B. F. Kutch Survey containing 81 acres.
(1)Has anyone leased to TSABA or is anyone familiar with them? The company has a Graham address.
(2)The lease offer is for a 3/16 lease and $50 per acre bonus. Is that a fair offer?
Thanks for any help.
M. Butler
seems mighty low to me.
I would not want an 18.75% royalty and $50 would indicate to me that there is very little interest in this area. I would suspect that this company will not be drilling this well but will likely be selling the lease to someone else and retaining an overrride on any production plus making a profit above the $50 per acre they are offering you.
Should you choose to do this, I would suggest you make certain that any royalty is a cost free royalty and not one that is even further reduced for "your share" of the costs as that is what the working interest is for and why they are asking for 81.25% of the production...
Thanks very much for your help.
If possible, would you suggest a counter offer (royalty interest and bonus). I do not know what mineral interests are being leased for. I would rather not have a lease than a bad lease so getting turned down on a counter offer would not bother me.