I haven’t followed the Bakken goings on for about 10 years so I’m really lacking in education. Is there anything new happening in Mountrail 158N, 92W? I received an offer for my family’s mineral rights. What would be a competitive leasing offer?
Many thanks.
Permits for new horizontal wells in Sec 3, 10, 15, 22. Recent leasing in those sections and 2, 8,17, 20 in addition. Royalties between 3/16ths and 1/5th. I prefer the higher royalties. Bonus amounts are private unless someone shares. If you have not leased in a while, it would be wise to get a good oil and gas attorney to review any lease. The draft leases are rarely in the favor of the mineral owner and need some edits.
Thank you for your response. Our offer of royalties is 20% and $600/acre bonus. The royalties are in line with our older leases but the bonus is less. There is also a 30 day time limit to accept the offer. I dont remember this from earlier (10-14 years ago). Is that standard or is my memory failing? Again, many thanks.
I usually ignore the time limits. That might be a sales pitch pressure point. But they might have a tight time frame before just going to pooling.
Thank you again. Would you know if $600/acre bonus is the going market rate? The lowest weve received in the past was $800/acre.
Cannot say, but in general, bonus amounts are lower now due to competition and what the market will bear.
Ms. Barnes has long been a good source of information and advice.
The only thing I would add is that oil men tend to sell on bonus money, instead of more important things, just like car dealers like to talk monthly payments instead of interest rates and sales prices. Bonus money is important, but not the most important except with mineral rights that are not in good areas and are unlikely to be drilled (for those, I take the money and run). Instead, focus on lease terms (3 years is ideal with no extension options), Pugh clauses, no warranty of title, royalty percentage (19 or 20%), deductions, shut in clauses (2 years max), cash up front, legitimacy of company leasing, etc… Be prepared to say no until they get realistic.
Yes, I’ve learned from Ms Barnes for many years. Thank you for you valuable insights. I’ll check the offer more closely based on your recommendations.