I have some interest in T 159N R97 W. It just came up for lease and I am curious what I should expect for a lease offer/what is a fair lease for this area... has anyone in this area negotiated any leases? Thanks!!
I think if anyone answers your question without knowing exactly where you are in that Twp and Range they would not be giving you a true picture because the north and south half appear to have markedly different properties of production.
you should provide the sections involved.... .
Just for fun, with the very limited information you provided.......lease half....participate or go non-consent with the other half.
Hopefully I won't be the only person to respond to you....you want r w kennedy's input.....but give him the section and the net acres involved.....the more information, the better the advice....
section 17 and only 7.5 acres
Also if I request a Pugh clause (which I understand is they can only go into one formation.?.?) how much can I expect the lease offer to decline? thanks again
My computer just recovered the webpage and my post is gone but I will boil it down. With all your acres in one spacing I would not worry about pugh clauses, even depth clause because the operator can just go to the NDIC who will for the asking determine that whatever the oil company wants is a common source of supply and to produce any of it is to produce all of it.
You are just north of the better production, I looked at every well in the T&R both Kodiak and Continental. 2 miles farther south the wells appear to be twice as productive. Missed it by that much. Won't sugar coat it, maybe 7 years to recover your money from participation. I haven't any recent information on bonus amounts in your very specific area but I think they should offer $800-$1,000 and 3/16. If I could negotiate to $1,500 and 20% I would call it good enough and save myself the headache, the area is just not good enough [although profitable] to give you a lot of clout. Presuming Kodiak is drilling your well, I would definitely call Diamond Resources and ask them if Continental was interested in leasing your acres because it's always good to have more than one offer. Continental drills a lot of wells also and I have seen them make better than average offers, possibly because it cuts down on landman costs and it's all profit anyway. Wish I had better news. Hopefully with the price of oil as it is, your bonus offers would be on the higher end off the bat. Good luck.
thanks again rw