We recently received an offer to lease our minerals in Custer County, SW/4 of Section 36-13N-18W. The offer was for $500/NMA for a 3 year primary term at 3/16ths Royalty with a 3 year option to extend. This seems like a really low offer to me. Does anyone have any information with other recent leases that may have been completed in this section or another nearby section.
What makes you think thats a really low offer? Unless Im missing something, there hasnt been a pooling in 13N-18W since 2008. That seems to be the going rate in the area, minus the 3 year option which you should strike.
Leases filed in the last three years in the township range from 1/8th to 1/5th so ask what they are offering at 1/5th. None have been filed in 36 in at least three years. The bonus is not so important. The clauses in the lease are the most important and highly unlikely that the draft lease is in your favor. It will need some edits-preferably by an attorney. Three year option to extend should not even be considered. It is a clue to me that they are not in a hurry or plan to flip.
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