Madison County ! Just received an offer from Navajo Resources Corp.
concerning AMY Boatwright Survey, A-7, Madison County , Texas
Lease offer :::: Tract total 34.0 gross acres of land
Own 6.0 net Mineral Acres… offer $500 per net mineral acres for 3 years with a two year option to extend for $400 per net Mineral Acres plus 1/5th
for the duration of the production life of any wells on property !
As you call see I am new to this form and would like any comments.
Thanks,
Steve
Not sure where this area is in Madison County - EOG has been very active with some very good wells along the Madison / Walker County line.
There is also production / development in other areas of the county but to a lesser extent.
All this new drilling is tied to expensive (i.e. $5-8 Million) horizontal and frac stimulated wells.
Value of minerals varies by area depending subsurface issues - even in a small county like Madison.
With respect to your offer (and this is just my opinion), the term (3 &2) is fine but ideally the royalty is too low - should be a max of 25% (more the norm in the trend with exceptions).
Bonus is low if you are in the EOG area but in the market for other areas.
I would suggest you try for either a higher bonus or a higher royalty - but not both.