Received an OGL offer on behalf of Bravo Arkoma, LLC for Sec. 32-8N-11E. Offer was $250/NMA for 3/16th for a 3 year lease. $300/NMA for 1/8th royalty.
I sent them my Exhibit "A" over 2 weeks ago and am yet to hear a word back. Followed up by sending lease broker an email to confirm receipt of same. Nada. No word.
Claudia Kemmerer,
I am relatively new to this forum....joined in Dec. '14. Helpful members are the following: M. Barnes, Wesley Skinner, Troy Curtis (Concho Jobs). and Clint Liles. I signed my lease for Hughes County before I knew of these knowledgeable persons named above. I still have concerns about the Exhibit A. . At the time of my signing I did not have a clue about negotiating one's lease , especially Exhibit A. My big concern now is 'post production charges' against my forthcoming royalties. I have taken note of one other person on this forum that is challenging their Operator's ' EXCESSIVE POST PRODUCTION CHARGES,' and is working with an attorney. And appears to me that Exhibit A wording for 'not allowing post production charges,' is critical. Keep all of us in Hughes Couty informed.....please........Leta
Maybe they didn’t like your Exhibit A. I’ve had some do that when I countered. Could be various reasons, Claudia.
These things take time. Don't do the 1/8th.
They are balking on the exhibit A post production charges in some areas, but I would rather not lease than have a bad lease. I just worked through a check stub of mine that was not supposed to charge post production. They charged from 30-80% on some items. Needless to say, my attorney is looking into it.
Here is part of their "red line" of my Exhibit?
ROYALTY: Lessee hereby agrees to deliver or cause to be delivered to Lessor, without cost into pipelines, a royalty of one-fourth (1/4) part of the oil or gas produced from the leased premises and a one-fourth (1/4) part of all casinghead or drip gas or gasoline or other hydrocarbon substances produced from any well or wells on said premises, or in lieu thereof, pay to Lessor without cost into pipelines the gross proceeds thereof, as the Lessor may elect.
NO DEDUCTIONS: Royalties payable under this lease shall be made without deduction for any voluntary deduction or tax including Marginally Producing Oil and Gas, and Energy Resource Revolving Fund. Further, no deduction for the cost of producing, gathering, storing, separating, treating, dehydrating, compressing, transporting, marketing and otherwise making the oil, gas and other products produced hereunder ready for sale or use. Notwithstanding anything herein to the contrary, all oil, gas or other proceeds accruing to Lessor under this Lease shall be paid without deduction for the costs of gathering, storing, separating, treating, dehydrating, compressing, processing, transporting, and marketing the oil, gas and other products produced hereunder to the extent such costs are necessarily incurred to transform the product into a marketable form; provided, however, Lessor’s share of any such costs which result in enhancing the value of marketable oil, gas or other products so as to receive higher net proceeds may be deducted from Lessor’s share of production proceeds so long as such costs are reasonable and do not exceed the value of the enhancement obtained by incurring such costs. In no event shall Lessor receive more or less than the actual amount received by Lessee.
Further "red lines."
INTEREST: Unless stated otherwise herein or if state statutes provide for a shorter period to make proper payments, all payments due to Lessor for royalties herein shall be delivered to Lessor within ninety (90) days after the last day of the month for which said royalties were due. In the event that said payments are not received within that 90 day time period, 12% compounded annual interest, calculated from the last day of the month for which said royalties were due, shall be paid to Lessor by Lessee. At Lessor’s option, all payments received shall be applied first to any outstanding interest due on prior late paid royalties, then to any prior outstanding unpaid royalties and then to any current royalties due. No notations on the remittance statements or provisions in any division order shall amend this provision.
FULL PAYMENT: Lessee or its assigns shall be responsible for the full and proper payment of Lessors' royalty from the date of first production until final depletion. No statute of limitations or other affirmative defense shall be asserted by Lessee or its assigns to prevent the full and proper payment of Lessors' royalty due herein from the date of first production of any well drilled herein until final depletion of that well.
FORFEITURE: The terms and conditions hereof shall be considered covenants running with the land covered by this lease and shall be binding upon and enure for the benefit of the respective successors and assigns of the parties hereto. If any of the material terms of this lease shall be violated, this lease shall be subject to judicial forfeiture. Provided, however, that forfeiture shall not be the exclusive remedy, but a suit for damages or specific performance, or both, may be instituted. The prevailing party in any action for breach of the provisions of this lease or breach of duties pursuant to this lease shall be entitled to recover reasonable attorney’s fees, expert witness fees, litigation expense and court costs. Notwithstanding the foregoing, Lessor will provide Lessee with written notice of any alleged violation of the material terms hereof and Lessee will have thirty (30) days after receipt of such notice to commence operations to cure the alleged violation. So long as Lessee commences operations to cure the alleged violation within said thirty (30) day period and thereafter proceeds with due diligence to cure the same, the lease will not be subject to judicial forfeiture.
FAVORED NATION CLAUSE: In the event Lessee pays a bonus amount greater than the amount paid to Lessor, for an oil and gas lease, and/or pooling action, in this section within six (6) months from the date hereof, Lessee agrees to pay the difference between the bonus amount already paid per acre, and the amount per acre of the greater bonus paid, to Lessor
Claudia, it is not unusual in our industry to receive an offer, reply and not hear back. If they are interested you will hear back, perhaps with a counter. Priorities are constantly changing and company may have acquired all the acreage desired. You may hear back in time. Did an Oklahoma attorney write your rider?
Don't use that no deductions clause. It will still charge you post production costs.
M Barnes .... I didn't. I returned my original Exhibit "A."
Stephanie: If you read my thread, you will see that I am in communications with them. I heard back and responded back.