We have 47 NMA in Hughes 34-4N-9E, and have an lease offer of $400 per net mineral acre bonus, 3 year term, 3/16th royalty. Does anyone have information that might assist in assessing the fairness of this lease bonus in this location? Or the possibility of multiple developers interested in the area?
Rudy
First offers are usually a bit low to final values. Energy Lease Brokerage and Corterra Energy Resources are leasing in the area. The terms of the lease and making sure you have a good Exhibit A with no post production charges are often much more important than the actual bonus.
Thanks, Martha. I do have a good Exhibit A. I'll take a look at those two producers. I actually don't yet know the firm name that's making me the offer (garbled telephone message, and he didn't provide that information in the email I requested, so I've asked for the information). It's not Corterra, though, so it's probably Energy Lease. I'll also check DrillingInfo to see activity in the area. I would really like to become better at using the free online sources (OCC and the like), as this sort of inquiry is the only thing I do with DrillingInfo for are these inquiries, and it's a bit expensive.
I just checked Drilling Info. That is where I got the info. That area is not the hot spot of Hughes. Always ask for the 1/5th and the 1/4th option. I can usually get 1/5th in Hughes, but not 1/4th since it is mostly gas and the margins are thin.
Thanks. That's useful information. Do you have any sources of actual current lease bonuses (not usually included with lease information in DrillingInfo) other than posting here and crossing your fingers? NARO used to post some information on this, but they stopped. I haven't found any other such information source recently.
I will, of course, see if I can employ the tried-and-true method of pitting multiple producers against one another. Over the years, DrillingInfo has (a little more than) paid for itself by letting me know who they are.
Still, it's helpful to have information about the lease bonuses others are getting, when that information is available.
Rudy
Public information on bonus amounts is from the pooling hearings. There are none in your particular area at the moment. NARO used to post some, but you have to be careful because they are generic by county and do not account for the particular geology of a section and township. Folks on the forum share occasionally. Due to the competitive nature, the bonus info is pretty confidential. The other source is the OK auction data, but since it is an auction, not really all that helpful but does give ballparks.
Just noticed your reply. Thanks. Is the auction you're referring to Top Dollar? I've done business with them in the past, but didn't know they were still around.
In 9N-9E over 10 zones have produced hydro carbons. The general attitude of oil companies now a days is to prove oil and gas in Shale, keep it tight, lease lots of acreage for minimum terms and then exit selling the leases for thousands of dollars keeping good ORRI and earning 20-25% carried working interest in the leases. Good example is Stack play where leases have been sold for up to 20 K per acre retaining high ORRI.
Correction: Thousands of dollars per acre. If good production is found in the Mississippian and the Woodford Shale the acreage will go up.
What type of Exhibit A you are talking about. What is a good exhibit A. Should I use my own lease which is different from standard lease