We received a proposal to drill Ellis County, Oklahoma, Section 8-16N-23W
In our inexperience, we did not negotiate previous proposals. My siblings, cousins, and I inherited 80 acres. My cousins own 40 & my two sisters and I own 40. The current proposal is $1,000/acre with 3/16 royalty. I don’t want to insult anyone, but I don’t want to get robbed either. I was volunteered as the liason. Would it be ridiculous to ask $2,000/acre with 1/4 royalty?
A secondary question, how can I run a 100 year deed check without going to OK? We’re concerned we may be entitled to more acreage. Unfortunately, neither of our parents did a good job of record keeping. We inherited these rights from our parents, who inherited them from their stepfather. Now, when we receive correspondence we show as heirs of a relative of our grandfather. The last time a company drilled all the paperwork showed as heirs of our grandad. I hope that makes sense. Thank you for your time
Ask them what they are offering for 1/5th and 1/4. There are already leases filed with those rates. The bonus amounts will be less for the higher royalties. That is how it works. You would not be able to get $2000 for a 1/4 lease. Probably much less than the $1000 or none at all. But the higher royalty can more than make up for that. The bonus is piddly compared to the royalty from a successful well(s). Would be very wise to share the costs of the advice from a good oil and gas attorney to get better clauses in the lease. A small investment in good advice can make you thousands in royalties. The clauses in the lease are so much more important than the bonus amount. Most savvy mineral owners would want the higher royalty.
You can either lease or wait for pooling. Both have pros and cons.
Yes, you can work backwards on the deeds by using www.okcountyrecords.com. It may not have digital files all the way back, but you can get part way. The rest would be in paper files at the county.
Thank you for your response. They’ve come back with an offer of 1/5 $200 and 1/4 $600. I’ve put the offers out to my family so we’ll see. And we’ll most likely start looking for an attorney. In the mean time, you mentioned pooling has pros too. Would you mind expanding on that for our particular location,
Ellis County, Oklahoma, Section 8-16N-23W? I’ve read through other threads but didn’t see a solid answer. I appreciate your time and knowledge
Theres no way theyd offer $600 for a 1/4 and $200 for a 1/5th. Do you have the numbers switched up? If they were offering $1,000.00 @ 3/16ths and offering $600 @1/4, go to your local bank and sign the OGL today!
Upland Operating will be the operator. They have already filed the OCC pooling case 2023-003178. You can either lease with Upland or another third party. If you lease, it is wise to get an attorney to review the draft lease because it will need changes to be more mineral friendly. A lease in that area is usually for three years or less. A lease will hold all minerals from just below the surface of the earth to the center of the earth.
For those folks that do not lease, force pooling will gather up all of the other mineral owners. A force pool is only for the reservoir on interest-in this case the Cherokee. And it will only be for six months to 18 months. Many are for a year. 0_The Pooling Process in Oklahoma.pdf (340.4 KB)
If timing is short or I cannot get a good lease with an operator, I like force pooling. If I can get the clauses I want with an operator, then I go with the lease.
Well the plot thickens. We have another company reaching out to lease. They’re offering $1150, possibly up to $1300 (if i can provide AFE) for 3/16; $750 @ 1/5, $350 @ 1/4 if I provide the current drilling proposal. Our current pooling agreement with Upland expires next month, but as far as we know, they never drilled.
I’m waiting to hear back from their representative as he did not provide the company’s name. He’s asking for other relatives’ names. Only one of my sisters and I received initial contact from Travis Kidd.