I got a surprise lease offer for my minerals in 19-18s-27e. Looks like Burnett Oil Co wants to drill 9 wells. This came as a surprise since I didn’t have any offers to buy out my minerals prior to permitting.
Has anyone heard anything? I checked some of the surrounding wells and the production doesn’t seem good at all. Perhaps Burnett has some cool new tech that will make it worthwhile?
Speaking of Burnett, I’ve never dealt with them. Are they reputable? I’m halfway considering participating (I’d have a .000XXX interest if I did).
Be aware that participating has it advantages and disadvantages. Participating is not recommended for the novice unless you have deep pockets, can hire an oil and gas attorney and an accountant, get liabilitiy insurance, put the the assets into an LLC to protect you from personal liability, be willing to pay decades of operating costs and pass that on to your heirs. Just a few items to consider. Talk to your CPA and attorney before deciding so that you understand the pros and cons.
Burnett already has multiple horizontal wells permitted from a location in 19 going west into section 24-18S-26E. And another set from section 24 going east into 19-18S-27E. Horizontals tend to have much higher production than vertical wells.
Hi- usually when we receive a participation/working interest lease request we will pass for all the reasons M. Barnes mentions, but we always request the operator/driller provide us with royalty lease terms and then negotiate a RI agreement. They can’t exclude you because you pass up participating in the well but if your minerals remain unleased it will be a long time before you see royalties due to NM’s rules.
Is it a lease offer, or an offer/election to participate? It seems to me that if it is an oil & gas lease offer, they may be running that concurrently with seeking permitting, but will need to do the spacing/pooling separately once they know who they can lease and who wants to participate.