Hi: I was offered
* $600.00 per net mineral acre
* 3/16ths royalty
* 3 year lease term
for my 30 net mineral acres in S3, T142N, R94W
It appears that a well is permitted and even being drilled already. I was told that 20% is simply not given anymore. Can anyone verify that? Also, information on lease bonus would be much appreciated. Thanks in advance.
Patrick
Patrick, in your area, it's probably true because they know what is there now. the nearby wells are marginal, there is not enough pressure underground to give "flush" production to help pay the wells off quickly. I looked at your immediate area for someone else and found that with up to date drilling practices and a pump being installed quickly that you are likely to see the well decline to 110 barrels a day or less after only 6 months. A well from 2008 has only done 10,200 barrels in 4.5 years. A recent well did 18,268 barrels in 14 months, still poor. Someone did say they got a bonus offer of $750 with 3/16 royalty. I would not want to participate or be non-consent in a well drilled in that area because of the long payout times. I think OXY is counting on another qualitative leap in production techniques or the price of oil to rise or both. I would tell the landman that you know they are offering others more bonus and work on that side because I think they mean it about the royalty. I wish I had better news. I hope this helps.
By the way, I rorgot to mention that your well permit has expired or been cancelled. Means nothing. they can get a permit electronically just like online shopping and the permit is $100, about 8 cents an acre. They are not currently drilling the well.
I got an offer for 18 1/2 % royalty on a top lease 1 year ago for land located in T 145, R 95W, Section 23. They gave me $500/net mineral acre. Originally, it had been a 20% royalty but when I pushed it, they backed off. There was a lot of activity all around the area where my mineral where located , they knew it & they also knew that I knew. My lease term was only for 3 years also. Seems they are going for shorter term leases in the past several years, Years ago I would lease them out for 5 years, but that was back in the early 1980's.
Mr. Kennedy and Kay: Very helpful information. Thanks so much. Patrick
Patrick and Kay, wish you "The Best" of luck, I am in 141 / 97 and am concerned about being on the edge.
Being a self semi-seasoned newbie,,,I feel there are sure to be undiscovered , benches, technology, fields, luck?, that will productive or as Mr. Kennedy says,,,Commercially Viable. Time will tell.
Going on the glass half full analogy, Anything that far east that proves itself, will be great for a lot of Nor Dakotans.
Sincerely, Good Luck.