Leasing Garvin County, OK Section 31-2N-1W

Oil and Gas Leasing Help
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I have been contacted by two companies regarding a lease in Garvin County, OK Section 31-2N-1W. MK & P Energy is offering a a bonus of $750 per acre for 22% royalty interest at a 3 year term.

Rimrock Resource Operating says they currently have a lease on our minerals and want to renew it offering a bonus of $200 per acre for 1/5 royalty interest or no bonus for 1/4 royalty interest.

That’s a pretty wide difference. I am unfamiliar with either of the companies and want to know whether either or both are reputable and reliable, etc. Thanks for any information. Sally Loden

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MK&P is probably a leasing agent. Rimrock is an operating company. First thing to do is look at your lease and see if you have a top lease clause. If you do, then you must offer Rimrock the offer from MK&P under the terms of that clause. I am not a fan of top lease clauses. I prefer leases to expire under their own terms.

Next, look at your lease and see if you have an option to renew. If so, then you are stuck with RimRock. If not, then let the lease expire and get a new lease with better bonus/royalty terms.

Now, look at your lease and make sure that it is the best lease you can get. I would suggest no post production charges, a depth clause, a commencement of drilling clause, limit shut in time, do not warrant title, do not allow free use of your oil, gas and water, etc. Not speaking as an attorney, but as a mineral owner who is very careful about how my leases read.

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Reputable or not, have the leases reviewed especially if there are significant acres. Also beware or delivery of lease without check (don’t accept drafts).

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Thanks for your advice and expertise!

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Thanks so much for your reply!! It’s very helpful! S Loden