Any lease offers being negotiated?
There were just a few before the pooling (and all last year), so not much active competition. At this point, you only have a few days left int which to answer the pooling, so better to just to do that. Only 20 calendar days from the date of the pooling in which to make your selection and mail by certified return receipt letter. Many of us prefer to take the highest royalty and the lowest bonus as that usually pays off better in the long run. You only get the bonus once, but the royalty will be used for every well in that horizon held by the pooling.
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If you make no selection, you will automatically be awarded the highest bonus with the worst royalty (1/8) . I agree with Martha, take a long view since the order may be in place for decades and decades to come. In addition to mailing the oil company, I file the election with OCC. Don’t wait.
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Thank you for your reply. Your answer concerning prior lease agreements and the urgency in completing the election before the 20 days expire brings to my mind another question. Does the election take the place of a lease agreement contract?
Thank you for your reply. I had not considered sending the election to OCC. Would, Amanda Payne Legal Secretary Judicial & Legislative Services Division P.O. Box 52000 Oklahoma City, OK 73152-2000 (405) 522-0279 Office (405) 521-4150 Fax [email protected], be an appropriate party to send it to?
Yes, the pooling order is a replacement for a lease contract. It is in essence a very short term lease for six months to a year and is only for the reservoirs named.
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Thank you again, I cannot thank you enough for sharing your expertise.
I followed yours and Martha’s advice. The Pooling Order was signed on April 2; the first certified receipt was never signed so I sent it again and it was signed as received on 4-22 and the OCC filing date was 4-15. As I read the Pooling Order, the Applicant, Red Bluff Resources, has thirty five days from April 2 to mail out the bonus payment. Did I read that correctly? It has been 35 days so I emailed them and got no response; I called and left them a voice mail and have not been called back. Any suggestions of a course of action to consider?
A certified letter may be in order. They may be verifying title. If non-payment persists, then some more creative approach may be in order.
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I’ll give that a try, thank you Mr. Winblad.
I received the bonus payment on 7-22 from the Operator’s agent. Fast forward: I received a letter from the agent on 10-6. They are requesting that I choose an election from the following 4 options: 1) Participate by paying your share of actual well cost; 2) Lease/Assign your rights for $2,750.00 bonus per net acre, 3 years and 1/8th royalty ( or deliver 87.5 % NRI); 3) “/” " " " $2,500.00 " " “, 3 " " 3/16ths " ( " 81.25 % “””); 4) “/” " " " $2,250.00 " " , 3 " " 1/5th " ( " 80.00 % “”"). These election options mirror the ones in OCC Order No. 693907 ( Cause CD No. 201900170) - I made my election on time, e.g. 4-6-19, with the Operator, evidenced by my receipt of the bonus payment ( from this agent) on 7-22. This letter by the agent concerns the initial " test " well the Operator is proposing to drill, not a “subsequent well”. Is this request for me to reiterate my election of 4-6-19? If so, then why? It seems redundant unless they are giving me an option to change my 4-6-19 election or something else. Could someone comment on what is the purpose of this letter? The letter states that they need my prompt election to this well proposal as " we will be initiating regulatory proceeding at the Oklahoma Corporation Commission "- The letter further states, " Please note, your election herein does not excuse you from making any applicable election(s) and/or well cost payments provided for in any Pooling Order issued by the Oklahoma Corporation Commission for the drilling of this well ". Is this request by the agent, on behalf of the Operator, normal protocol? Is this letter’s purpose related to establishing a three year lease possibly? is there anything I should be aware of before fulfilling the agents request?
The letter is just a courtesy. You do not have to answer it. I never do. You must also answer the pooling letter. "your election herein does not excuse you from making any applicable election(s) and/or well cost payments provided for in any Pooling Order issued by the Oklahoma Corporation Commission for the drilling of this well ". Did you already get the bonus? Did you agree to lease or to go to pooling? If lease, did you get your lease straightened out? If not, then you just notified them of your intention to be pooled. Be sure you answer that pooling and answer the same way. Send the letter by certified mail. Tell them that you have already picked Option X and received a bonus of X. List your contact person, dates, etc. Sometimes, the land folks don’t get all the information to the pooling attorney in a timely fashion, so you want to be sure they know about you. Since you got the bonus, you are probably okay, but just need to verify with your letter.
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Thank you Martha for the clarification; you responded to me April 10 informing me that my election under the Pooling Order was in effect a temporary lease. The Operator’s agent who sent me this " courtesy letter " is the party who issued my bonus payment on 7-22-19 so they should have a record of that; however, I will follow your suggestion and send them the details anyway just to try to be clear, consistent, and hopefully avoid any potential or real discrepancies. Ialways appreciate your responses and your care and concern for the members of this forum…many kudo’s to you, kind lady!!!
The pooling list is sometimes drawn up months ahead of pooling, so any leases or agreements to pool may not be updated in that list when the true pooling notice goes out. I always just send that second letter so that there is no questions about what my decision was. Has saved my bacon a couple of times. Send Certified Mail return receipt requested and then you can prove they received it. Send to the address listed in the pooling order.
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Perfect, will do Martha; many thanks for your valuable insight and time.And in the famous closing words by Red Skelton…God Bless!
I do not have access to the OCC’s website in order to print Cause CD No. 201905478. Could someone please provide me with a link to it? The Operator, Red Bluff Resources Operating LLC, (through their legal team, Helm & Boone) just forwarded a " Notice Of Continuance" notification to me - The hearing before the OCC is scheduled for 1-27-2020. Could someone please explain the purpose of this upcoming proceeding?
The web location for OCC files is: OAP Type the case number into the Case # box and you will get all the postings that go with it. It is a pooling application for those mineral owners who have not yet leased. Normal business before drilling a well. Once the hearing happens and an order is issued, you have 20 calendar days in which to answer. Typically, they will give three-four options for a royalty and bonus pair. Many of us pick the highest royalty and the lowest bonus as it usually pays out more in the long run.
They want to drill a horizontal well. The other case numbers that go with it are 201810867, 201810868, 201900170 which was an earlier pooling. That last one will give you a ballpark idea of what the order for the new one will be.
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Thank you Martha! I apologize for the delay in my reply but I wanted to go back and refresh my memory about the sequence of events - Your OCC link allowed me to do that along with matching documents that I have received in the mail since January, 2019. As you mentioned, the OCC signed the forced pooling order no. 693907 on April 2, 2019. I made my election then within the 20 day window. I also received my bonus payment from the Operator’s agent in July, 2019. Would you please explain why the Operator is petitioning the OCC again for an additional Pooling Order (one that appears to duplicate the April 2, 2019 Pooling Order)?
The first pooling had 180 days in which to commence the well. Sometimes, they have folks whose leases have expired since in the first pooling and they do a catch up pooling. I did not do a side by side comparison of the names on each respondents list. You could download both pooling order copies and read to see if they changed the horizon or if the respondents are different.
The Lillian 1405 3-33MH was spud from section 3 on May 6, 2019. First sales were about 9/5/19. Division Orders should be out by Feb or so and payments in March 2020.
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Yes Martha it happened just as you predicted; I received the Division Order on 21 Feb. Should I contact a professional to verify the revenue interest percentage before I sign and return it to the operator?