Hello. Does anyone have any information on oil/gas leasing activity, bonus and royalty rates for Grimes County, Texas?
Additionally, is Grimes County or parts of Grimes considered to be in the Eagle Ford Shale play? Or is this something that may occur in the next several years when and as the play moves to the east more?
Thank you.
Grimes County is on a map on the Internet as being part of the Eagle Ford Shale play. The drilling is moving that way. I have heard of bonus payments of $200-$650. Royalty is anywhere between 20% and 25%. There should be more leasing and drilling activity within the next two years. The first people to lease got the lesser amounts, which is probably true everywhere.
Thanks for responding, 6th. I'm under the same impression as you that the Eagle Ford Shale is moving our way; it's just a matter of time which equates to having patience, and patience, hopefully, will equate to more money in the long run, assuming we go through with this. Our land is near Singleton and we've been offered $300/acre for 3 year term; $200/acre for additional two years; 20% royalty. After reading all the information on this board, I don't believe we'll be signing up for more than a 3 year term and they'll have to do better on the bonus plus up the royalty to at least 25%. Hopefully we'll be able to come up with something mutually beneficial. If not - oh well. It wouldn't be the first time we passed up a lease.
6th Generation Texan said:
Grimes County is on a map on the Internet as being part of the Eagle Ford Shale play. The drilling is moving that way. I have heard of bonus payments of $200-$650. Royalty is anywhere between 20% and 25%. There should be more leasing and drilling activity within the next two years. The first people to lease got the lesser amounts, which is probably true everywhere.
Yes Captain, you are correct, time and patience is what land/mineral owners need. I turned down an offer of $350 an acre bonus and 20% royalty. I wouldn't agree to an extension. If a company didn't develop the minerals within 3 years and the lease expires, they can negotiate with me then at the going rate.
Who knows what lease rates will be 3 years down the road. Hopefully a number of good wells will be brought in during this time and bonus rates in our county will be greater. If you look at the RRC web site on the Eagle Ford Shale, you will see that Grimes County is shown as an oil zone on one map and that the trend is moving this direction. The picture will definitely be much clearer in 1-3 years. One thing about it, the oil and gas, if there, is still in the ground and isn't going anywhere.
Captain Skittles said:
Thanks for responding, 6th. I'm under the same impression as you that the Eagle Ford Shale is moving our way; it's just a matter of time which equates to having patience, and patience, hopefully, will equate to more money in the long run, assuming we go through with this. Our land is near Singleton and we've been offered $300/acre for 3 year term; $200/acre for additional two years; 20% royalty. After reading all the information on this board, I don't believe we'll be signing up for more than a 3 year term and they'll have to do better on the bonus plus up the royalty to at least 25%. Hopefully we'll be able to come up with something mutually beneficial. If not - oh well. It wouldn't be the first time we passed up a lease.
6th Generation Texan said:Grimes County is on a map on the Internet as being part of the Eagle Ford Shale play. The drilling is moving that way. I have heard of bonus payments of $200-$650. Royalty is anywhere between 20% and 25%. There should be more leasing and drilling activity within the next two years. The first people to lease got the lesser amounts, which is probably true everywhere.
Petromax is paying $125.00 per lot in town, in Iola for 3 years with a 2 year option and 20% of 1/5 when they start producing. Petromax, Crimson & Apache are in the area.
$125.00 per lot? Did you mean acre?
no, I mean $125.00 per lot for 3 years. I have 3 lots, which comes to just a smidge under 1/2 acre, I got $375.00
They are paying by the lot because I am in town, I have no idea what they are paying for big acreage.
Captain Skittles said:
$125.00 per lot? Did you mean acre?
Good to know. Thanks.
You're welcome!
Captain Skittles said:
Good to know. Thanks.
It is good to hear that more players are in the game. Maybe we will see more leasing and drilling activity this year!
Sammie Jo said:
Petromax is paying $125.00 per lot in town, in Iola for 3 years with a 2 year option and 20% of 1/5 when they start producing. Petromax, Crimson & Apache are in the area.
I have googled all types of mathematical formulas for devising a cost per acre, should an owner desire to sell their land, in an area where there is high production in an area close. very close, to their own property. Sales prices can be based on if you are currently receiving royalty from a pool 35 to 45 times the monthly rate of the royalty (one googled formula), to the current Marcellus Shale land prices which are $4000 to $10,000 per acre for the mineral rights alone, should you desire to sell the property with the mineral rights, along with the accepted prices for the sale of agricultural land in the area.
If anyone else has come across some interesting formulas for calculating price per acre with mineral rights with an open ended lease or lease with extremely favorable clauses, i.e. 22% royalty plus .05% for anything over $110 bbl, the whole property must be part of the pool and no Pugh clause, etc., I would like to know.
Thanks.
Jack Ross said:
I have googled all types of mathematical formulas for devising a cost per acre, should an owner desire to sell their land, in an area where there is high production in an area close. very close, to their own property. Sales prices can be based on if you are currently receiving royalty from a pool 35 to 45 times the monthly rate of the royalty (one googled formula), to the current Marcellus Shale land prices which are $4000 to $10,000 per acre for the mineral rights alone, should you desire to sell the property with the mineral rights, along with the accepted prices for the sale of agricultural land in the area.
If anyone else has come across some interesting formulas for calculating price per acre with mineral rights with an open ended lease or lease with extremely favorable clauses, i.e. 22% royalty plus .05% for anything over $110 bbl, the whole property must be part of the pool and no Pugh clause, etc., I would like to know.
Thanks.
There's a royalty calculator right on this site. Go to the top of the page and click on "Mineral Help" a drop down with a royalty calculator will appear, go in there and you can get an estimate.
Saw a simular map in Oil & Gas Journal. However the real play in Grimes County seems to be the Woodbine A and Georgetown. Have heard the Georgetown is far wilder in covered area and may very well have a larger pay zone as well. Crimson has turned its sights on northern and mid-central Grimes. Crimson seems to have focused on areas north of Iola and south of Iola. But it appears the area up next to Madison County may very well be a target area as they have acquired a fair amount of leases in that part of the County.
Crimson's play is 100% oil but any gas produced will be icying on the cake.
I for one would want to be a part of that action, should I own mineral rights in those areas. Why lease to someone who will simply sit on the lease. Isn't it better to get a fair acreage fee upfront and then also be a part of a pool that goes with a producing well? Dollars are larger and for many many years to come.
Hi Captain, have you leased yet? I heard a rumor that some people were getting paid $1,400 an acre lease bonus in Grimes County (a local area attorney told a friend of mine that some leases were going that high). I don't know where in the county or even if it is true. I thought that was interesting and want my friend to ask more questions. Now that sounds llike a good pay day!
Captain Skittles said:
Thanks for responding, 6th. I'm under the same impression as you that the Eagle Ford Shale is moving our way; it's just a matter of time which equates to having patience, and patience, hopefully, will equate to more money in the long run, assuming we go through with this. Our land is near Singleton and we've been offered $300/acre for 3 year term; $200/acre for additional two years; 20% royalty. After reading all the information on this board, I don't believe we'll be signing up for more than a 3 year term and they'll have to do better on the bonus plus up the royalty to at least 25%. Hopefully we'll be able to come up with something mutually beneficial. If not - oh well. It wouldn't be the first time we passed up a lease.
6th Generation Texan said:Grimes County is on a map on the Internet as being part of the Eagle Ford Shale play. The drilling is moving that way. I have heard of bonus payments of $200-$650. Royalty is anywhere between 20% and 25%. There should be more leasing and drilling activity within the next two years. The first people to lease got the lesser amounts, which is probably true everywhere.
I've read the information posted by others on this Grimes County forum, but I haven't found the answer to a question I have. Last week my brother and I had a call from a landsman representing New Horizon Resources, LLC. He's offiering to lease the oil, gas, and mineral rights on some land we have in Grimes County. We have two concerns: First, what he's offering is lower than what I've seen mentioned on this forum, and second, we cannot locate New Horizon Resources on the internet nor is it listed as one of the current operators in Grimes County. (We did find a New Horizon Green Energy Resources, but that's not the same outfit.) There's no phone number or street address on the letter that accompanied the lease we were to sign--just a PO box number in Houston. Naturally, we are not signing anything at this point. We have a lot of homework to do first, and number one on the list is finding out something about New Horizon Resources. Does anyone know anything about the company?
I did a search for you and all I found is a New Horizon Exploration in Houston http://www.oilandgas.com/index.aspx No phone # or street address doesn’t sound legit to me. This could be a scam where they lease your land, then re-lease it to a real oil company and get all the money. I’ve seen a lot of oil co signs around here and none of them by that name.
That's exactly what we thought, Sammie Jo. Today, even the smallest company or business has some sort of web presence, and when I didn't find anything for New Horizon, my suspicions immediately went up. The guy who called me was also in a big hurry to get me to sign the lease--even offered to drive it down to Matagorda (where I currently am) from Houston the day he called. As I said, my brother and I are signing nothing. If "New Horizon" is interested in our land, perhaps down the line a legitimate outfit will eventually come along and be interested, too. Thanks for adding your research to the answer!
Carolyn Mathews said:
That's exactly what we thought, Sammie Jo. Today, even the smallest company or business has some sort of web presence, and when I didn't find anything for New Horizon, my suspicions immediately went up. The guy who called me was also in a big hurry to get me to sign the lease--even offered to drive it down to Matagorda (where I currently am) from Houston the day he called. As I said, my brother and I are signing nothing. If "New Horizon" is interested in our land, perhaps down the line a legitimate outfit will eventually come along and be interested, too. Thanks for adding your research to the answer!
No problem, it always irks me to see people trying to scam others.
I think you're right about if the scammers are interested, a legit co will be soon.
Another development on my situation: The guy who wants to lease the mineral rights to my land, the "New Horizon Resources, LLC" person, called back today and when I asked who he was working for, he said Wilson Oil. I don't see Wilson Oil listed as a Grimes County operator. I did find a Wilson Oil (out of Livingston) listed in the Railroad Commission of Texas oil & gas directory, but Wilson is not mentioned anywhere in the lease I've received. I guess I'm getting paranoid and thinking that someone wants to lease my rights for a minimum sum right now, and then lease them to someone else for more money at a later date. My next step should probably be to contact Wilson Oil and find out if the person who sent me the lease is indeed working for that company. I've leased mineral rights in the past, on another piece of property, and at that time the exploration company's name was all over the lease papers. I'm a patient person and not about to sign anything any time soon.
Carolyn Mathews said:
I've read the information posted by others on this Grimes County forum, but I haven't found the answer to a question I have. Last week my brother and I had a call from a landsman representing New Horizon Resources, LLC. He's offiering to lease the oil, gas, and mineral rights on some land we have in Grimes County. We have two concerns: First, what he's offering is lower than what I've seen mentioned on this forum, and second, we cannot locate New Horizon Resources on the internet nor is it listed as one of the current operators in Grimes County. (We did find a New Horizon Green Energy Resources, but that's not the same outfit.) There's no phone number or street address on the letter that accompanied the lease we were to sign--just a PO box number in Houston. Naturally, we are not signing anything at this point. We have a lot of homework to do first, and number one on the list is finding out something about New Horizon Resources. Does anyone know anything about the company?
did you get the phone # for wilson oil? It's 936-327-2622.
Trust your gut, if it smells like a skunk, it's usually a skunk.
Better safe than sorry.
Just offhand, the signs on rigs around here that I have seen are Crimson, Apache, Petromax, and a few others, but none that say new horizons or wilson. I'll keep an eye out.