I am curious if anyone else has a signed lease with Whiting Oil & Gas in the Sheridan area. Our mineral acres are 31N 56E area. Also, do you know if they are active anywhere in the Montana area yet?
Deann our family signed with a broker who then leased to Whiting. So they currently hold the lease for ours. And as nearly as I can tell they have been leasing up rights in north eastern Montana, but not drilling at this point. I found a link that shows where any wells and if they are active or dry, etc. You have to research the sites to see when the wells were drilled, but it is interesting. It does not show any by Whiting yet.
For current activity see the montana webbmapper, it shows all the drilled wells. horizontal wells are shown by red lines.
I know that the area has been temp spaced but no permits for drilling yet. Whiting gave me a name and number of who is in charge of that area, I guess we better give him a call and see if he has more information for those of us wondering :)
that sounds like a good idea. Can't wait to here what you find out. Ours is in that same area as well.
My husband spoke to the lady in charge of that area from Whiting and was told that at this time they do not have plans to drill as the equipment and labor is tied up in Dakota....we will see!
Lenne:
Just for clarification only and to get the terminology so everyone is talking apples & apples. You say that your family "signed" with a broker. I assume that what you signed was a lease, and if I am wrong let me know. If it was a lease and you say the broker leased to Whiting, then what you really mean is that your family "leased" to a broker. The broker then "assigned" the lease to Whiting. I am not being critical of what you wrote but just want to clarify the terminology. Your family is the "lessor" to the broker who is the "lessee." The broker then is the "assignor" to Whiting who is the "assignee." And all further ownership on an active lease will be assignments. Once a lease expires then the mineral ownership can be leased again, or someone can come in and lease you again before your lease expires, and in which case their lease begins at the expiration of the current lease and this is called a "Top Lease".
Now, if the paperwork your family signed had Whiting as the lessee then everything I wrote above is null & void. Brokers can work either way. (1) Contract with an oil production company and get paid to obtain leases in the oil company's name or (2) obtain leases on their own and then sell "assign" them to the oil company's and the difference in what they pay you and what they get paid for assigning the lease is their income.
Wich is the better way to go?
If the lease was signed by the owner with broker, and it has an expiration date, are you saying that the owner may not get the option to negotiate a better deal at the end of that lease?
No matter what, at the end of the lease whether it has an option for additional years or not you can negotiate a better deal. What I was saying is if the broker took the lease in his companies name then you are the lessor and they are the lesee. If Whiting now has the lease then the broker sold, (assigned) the lease to Whiting and Whiting is the assignee with the broker being the assignor. If that is what was done then obviously the broker made money selling it to Whiting. If you would have had the chance to deal with Whiting you probably could have gotten a little more bonus money and a little better royalty. Brokers are in the business to make money. Here is simple example: You signed (leased) to broker @ let's say $600 acre and a 16.5% royalty. Broker assigned the lease to Whiting and got $675 acre and a 2.5% overide on the royalty. The broker makes $75 acre on the lease and the overide. You can do whatever you want at the end of the lease if nothing happens and the lease expires, but if the property goes into production your bonus money is a one time deal and your royalty is whatever your lease says.
Lenne Buzzell said:
Wich is the better way to go?
If the lease was signed by the owner with broker, and it has an expiration date, are you saying that the owner may not get the option to negotiate a better deal at the end of that lease?
What I said below is very smplified. There are many many senerios....what if a well produces but not enough to make production worthwhile? What if the well is shutin? You really need do do some reasearch if you are in an area that has production and if so get a good O&G attorney.
Richard Needles said:
No matter what, at the end of the lease whether it has an option for additional years or not you can negotiate a better deal. What I was saying is if the broker took the lease in his companies name then you are the lessor and they are the lessee. If Whiting now has the lease then the broker sold, (assigned) the lease to Whiting and Whiting is the assignee with the broker being the assignor. If that is what was done then obviously the broker made money selling it to Whiting. If you would have had the chance to deal with Whiting you probably could have gotten a little more bonus money and a little better royalty. Brokers are in the business to make money. Here is simple example: You signed (leased) to broker @ let's say $600 acre and a 16.5% royalty. Broker assigned the lease to Whiting and got $675 acre and a 2.5% overide on the royalty. The broker makes $75 acre on the lease and the overide. You can do whatever you want at the end of the lease if nothing happens and the lease expires, but if the property goes into production your bonus money is a one time deal and your royalty is whatever your lease says.
Lenne Buzzell said:
Wich is the better way to go?
If the lease was signed by the owner with broker, and it has an expiration date, are you saying that the owner may not get the option to negotiate a better deal at the end of that lease?
Richard Needles said:
What I said below is very smplified. There are many many senerios....what if a well produces but not enough to make production worthwhile? What if the well is shutin? You really need do do some reasearch if you are in an area that has production and if so get a good O&G attorney.
Richard Needles said:No matter what, at the end of the lease whether it has an option for additional years or not you can negotiate a better deal. What I was saying is if the broker took the lease in his companies name then you are the lessor and they are the lessee. If Whiting now has the lease then the broker sold, (assigned) the lease to Whiting and Whiting is the assignee with the broker being the assignor. If that is what was done then obviously the broker made money selling it to Whiting. If you would have had the chance to deal with Whiting you probably could have gotten a little more bonus money and a little better royalty. Brokers are in the business to make money. Here is simple example: You signed (leased) to broker @ let's say $600 acre and a 16.5% royalty. Broker assigned the lease to Whiting and got $675 acre and a 2.5% overide on the royalty. The broker makes $75 acre on the lease and the overide. You can do whatever you want at the end of the lease if nothing happens and the lease expires, but if the property goes into production your bonus money is a one time deal and your royalty is whatever your lease says.
Lenne Buzzell said:
Wich is the better way to go?
If the lease was signed by the owner with broker, and it has an expiration date, are you saying that the owner may not get the option to negotiate a better deal at the end of that lease?
If the lease goes into production there is no expiration to the lease unless other factors enter in as I mentioned...ie: shutin, insufficient production etc.