Northshore Energy & Investments Inc is trying to lease minerals in E/2 SW/4 of Section 21-7N-3W to drill a test well for Encore. They already have leased and supposedly drilling within next two months, having pooled none leasers in at in W/2 SW/4 Section 21 7N 3W and assume the corp. commission will allow them to pool in E/2 SW/4 of Section 21 7N-3W at the same rate. 1/8 $425 3/16 $375 1/5 $325 3 year lease This is a vertical wellbore, and they wanted to give us an opportunity to lease before it gets pooled. I know things have slowed down but have the mineral leases dropped this low in value? Has anyone had any dealing with Encore or Northshore?
Have they said what reservoir they plan to drill? Since oil prices have dropped about 50% in the last two weeks, leasing prices will usually follow that trend. Leasing prices are not public unless folks want to share their offers. The closest that you can get are the pooling orders in contiguous sections. There are none at the moment. The closest would be the Roan pooling in section 19 for $1500 3/16ths, $1125 for 1/5, $0 1/4 which was in September of 2019 for a horizontal well. They tend to go for higher amounts since the production zone is larger. The clauses in the lease are more important to me than the bonus amounts. The first draft of the lease will be all in their favor and will need negotiation to get into the mineral owner favor. You do not want post production charges and a few other clauses that are probably in the draft.
Didn’t say what reservoir but said there would be a depth clause. Thanks
I have had some lease offers to lease shallow reservoirs for vertical holes. We always put a depth clause (and several other important clauses) in the lease. Since they are shallow holes, they lease for less. It can be worked out.
Ask them what reservoir they want, when they are planning to drill, when are they planning to pool and what will be the max offered at pooling and ask for a draft of the lease. Then you will see if they are serious in the current price environment.
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