The last crash was a really good one. So, I personally think the market is in a state of repair. Some times its a really long grind for higher prices. The crash in the late 90’s, oil was like $10 a barrel or so. I did not think it would ever go up! Most everyone in any oilfield business was dying. I knew a guy that bought a directional drilling rig at a fire sale price and built a business starting with that one rig and went on to make millions.
Thanks Stephen Weeks for the info. I was afraid that was the answer. At least the prices are better this time around.
M Barnes is right. The book from NARO Look before you lease is very good. I have learned a lot of things I did not know and will be better prepared when the lease expires in April 2018. Thank you
I received an offer for a mineral interest lease last week for a tract of land described as being in the W/2 of Section 6, Township 7 North, Range 3 West, McClain Co., OK, which apparently was owned by my grandfather and left in my name. He died in 1985, however, and it’s as yet undetermined how many acres he owned or if it might have been sold. No records in OK. Fortunately, There is a probate trail that I’m following, but any insights into activity in the area would be helpful. The initial offer was for $1,600 per net acre bonus for a 3 year term with a 2 year extension, having a 18.75% royalty 3/16th. Based on my cursory review of recent discussions, that seems low, but I’m also new to the forum and learning about the topic as I go. Thanks to all for any help you could provide!
Eric,
That sounds a lit low. Section 7 had $1600 1/5 previously. You do not want a two year extension. Always ask for the 1/5th and 1/4th set. Read over the last six months of comments here on the county and get a feel for the advice regarding lease terms, Exhibit A clauses, etc.
I signed a lease with Okie Energy this past November. They said they had 45 days to do their title work and get a check to me. Those days have come and gone and when I called to inquire they said they have been busy and needed more time. I have not dealt with this before and am wondering what my options are?
The McClain County Clerk’s Office closed the Tuesday before Thanksgiving and just reopened this week. There has been a delay for all companies needing to verify title due to this.
Thanks Brent. That would explain the delay.
It is not. When I talked to the guy he says it is the standard number of days in which to close.
Does anyone know if there is any laws or rules for how long before oil companies have to pay out royalties once they start producing.
Thank you Tom and Debbie, to my understanding they started production the first part of July of 17, how can I confirm that?
They are to begin paying 6 months from date of first production.
Six months from date of first sales. If longer the operator owes you back revenue + 12%.
Larry - If it is an oil well, first sales occur when the purchaser picks up the first load of oil. The acronym is “dofs”. That may, or may not, be the first day oil started flowing into the tanks. The acronym is “dofp”.
Gas is different because first sales occur when gas starts flowing into the pipeline.
Also Okla Tax Commission website-do a public PUN search. Will give you month of first sales
Tom Moore/ Debbie Downey, just got a e-mail from Casillas Petroleum saying that division orders have been sent. They also stated that their DO analyst said that my interest is in suspense. Can you tell me what they are talking about. Thank you in advance for any help you can give me
Larry,
Saying the title is in suspense is a way to only allow 6% six months after first sales. Contact their DO analyst and inquire what hoop they want you to jump through. They have to tell you what clouds the title.
Any thought on what a fair price would be for a 3-year, 3/16th lease on minerals in 5n-3w? (More specifically, 50 net mineral acres in sec. 2-5n-3w.) These minerals are open and would like to get them leased.
I would suggest you not consider selling any mineral rights in McClain right now. Lots of leasing and drilling going on there. Hang tight if you can!