Dynamic Resources has offered us: $30.00/acre and 14% of production. 5 year term.
Our area is:
157N Range 88W Sections 7 and 18
157N Range 89W Sections 14 and 23
154N Range 88W Sections 11 and 12
153N Range 88W Section 14
When I questioned our contact at Dynamic on the low $30.00/acre offer this was his response:
He said that our area would be Mission Canyon fields East of the commercial production of the Bakken Shale, where the formation pinches out, known in the industry as the "line of death".
Has anybody heard this term before?
He said that East of this line, the industry has determined that the Bakken, if present, is noncommercial. As a result, exploration for Mission Canyon production is a conventional play are carries much higher risk with lower return on investment than Bakken.
I don't know anything about the area so I welcome any feedback to determine if this sounds reasonable or is it landman crap.
Greg, Looking at the ND map of the area https://www.dmr.nd.gov/OaGIMS/viewer.htm Puts some credence to his tale. A lot of wildcatting has occurred in the mid eighty's. With poor results, however this is the modern age and interest in your area seems to be happening. I wonder if the scare tactics of the landman are appropriate in this new age of exploration? And a five year tie up even in the so called "line of death" is too long in my humble opinion.
Check out the map, hope this helps in some way. Brian...
Right, much more risk to drill a conventional play, so I would volunteer to risk along with them for $100 bonus and 22% that way if they don't find anything it does not cost them anything but $100. Since I am letting them keep most of the bonus money so they could afford to drill, I would also need a drilling commitment from them.
Sorry, I just couldn't sit there and listen to them poor mouth. Your offer sounds like a speculator. I would be highly surprised if the deal was not 5 years with at least a 3 year option tacked on to it.
Really, when you think about it, Texaco was leasing from my family 40 years ago when the Bakken was no kind of sure thing, they were after the Madison and they were paying $50 per acre back then. That would be worth $300 per acre at least by my estimate in todays dollars.
There is always the wisdom of my brother who knows little of oil and gas but has a good deal of experience in general, who I think would say "if it's worth anything at all, it's worth more than that". This is an oil lease we are talking about isn't it?
Then too, with cost of ownership already being sunk costs, you might feel like gambling $6 per acre per year that the value will rise. Stranger things have happened.
Only if they offered you a drilling commitment [ which would be considered part of your consideration ] with appropriate damages if it does not happen would I think you received adequate consideration.
We were offer 35 per acre and we are on the near edge of the bakken maybe none at all. The thing is oil is still all around us. The can find the pools with 2dor is it 3d seismic imaging. Or they make very good educated guesses. Other formations could be below and traps can be formed at the pinch outs. Line of death tern I heard of meant the btochton froid fault zone. Are you near that? . It doesn't matter. It's not a death line. He's trying to get something for nothing.
My Grandfather owned minerals that were vested unto my siblings and I after he passed away that sit in Mountrail County.... I too have been contacted by Dynamic Resources and are in the middle of negotiations with them for our minerals that are located inside their "future drillsites". We were approached at first with $30 for a bonus...then they called back and offered our family $45 for a bonus with one-sixth royalty with a 5 year lease but mentioned all family members had to be on board to get the deal. Needing some advice from the locals in this area about this lease offer we have received. My sister is an attorney in Oklahoma who deals specifically with oil and gas leases and is in the process of reviewing Dynamic's paperwork. She knows the ins and outs and we are just sitting on it until we hear on what to do from her. Has anyone made any negotiations with this company?
Rikard we were approached with the same terms, except $50 for a bonus. Perhaps we all should
find an attorney to negotiate on our behalf.
Carolyn Moyer
Rikard W. Schwede,III said:
My Grandfather owned minerals that were vested unto my siblings and I after he passed away that sit in Mountrail County.... I too have been contacted by Dynamic Resources and are in the middle of negotiations with them for our minerals that are located inside their "future drillsites". We were approached at first with $30 for a bonus...then they called back and offered our family $45 for a bonus with one-sixth royalty with a 5 year lease but mentioned all family members had to be on board to get the deal. Needing some advice from the locals in this area about this lease offer we have received. My sister is an attorney in Oklahoma who deals specifically with oil and gas leases and is in the process of reviewing Dynamic's paperwork. She knows the ins and outs and we are just sitting on it until we hear on what to do from her. Has anyone made any negotiations with this company?