Hi There,
Just joined the site. Had no idea this existed and it appears to be a wonderful resouce for something I know very little about. My Grandmother had mineral rights that passed to my Mom and have now passed to me. I received a phone call from Calvin Energy offering me $400 per acre, 3 year lease (with 2 year option) and 3/16th royalty. The property is Section 18-4N-7W in Grady County, OK. Can anyone offer any advice on this offer. I wasn't looking to lease, didn't even realize anyone would be interested. I am struggling with the "this is too good to be true" philosophy and I saw several posts on here that people were not taking offers from Calvin. Suggestions?
Hello Perilyn-
Welcome to wonderful and at times very confusing oil business. I have been in it for over 50 years and I still get confused by some of the happenings. Your property is a little bit west of where all the drilling is taking place now in Grady County. The producing trend lines for oil, condensate and gas lie in a NW to SE direction across the county. The hottest area is around Lindsay. The area just east of Chickasha is also receiving a lot of attention.
The area where you are located will probably be considered more prone to producing natural gas. There may be also some condenstate with it. Calvin Energy is probably leasing for a bigger outfit. Some others on this forum will be able to help with that. Is Calvin the only company you have an offer from? The $400 an acre is not bad but, if activity picks up in that area there will be competitiors showing up.
Some others may chime in with other comments and you may be able to compare some offers of other leasing companys in your township. But I will tell you, it can be a long haul from the time a lease is taken until a well is drilled. And, after a well is drilled and completed successfully it will be at least 6 months before you get your first Royalty payment and may be longer.
But welcome anyway. It will be a roller coaster ride as you get leased and wait for the well to be drilled.
Unless you need the money, I would just sit tight and do nothing for right now. Like Don said, you are a little west of the action, (12 to 18 miles ) but that will more than likely change in the not to distant future. My family went from no wells to 6 producing wells in less than a year. Hang on, if you can...
John,
Thank you for your reply. Being new to this ... what is the advantage to waiting? Better lease offers? Better royalty percentages? What happens if they do drill and I have a 3 year lease in place?
Perilyn
John Tennison said:
Unless you need the money, I would just sit tight and do nothing for right now. Like Don said, you are a little west of the action, (12 to 18 miles ) but that will more than likely change in the not to distant future. My family went from no wells to 6 producing wells in less than a year. Hang on, if you can...
John, my sister and I recently leased our minerals in Sec 18 6N 7W. As I understand it we, too, are west of the current activity. My cousin has an equal interest but has yet to lease his minerals. I've heard Superior Title is also signing leases in this area. Any current info you can share about how close the activity is to our minerals?
Thank you,
Mike Mager
Perilyn Wood said
John,
Thank you for your reply. Being new to this ... what is the advantage to waiting? Better lease offers? Better royalty percentages? What happens if they do drill and I have a 3 year lease in place?
Perilyn
John Tennison said:
Unless you need the money, I would just sit tight and do nothing for right now. Like Don said, you are a little west of the action, (12 to 18 miles ) but that will more than likely change in the not to distant future. My family went from no wells to 6 producing wells in less than a year. Hang on, if you can...
Hi Perilyn and welcome to the forum. I would not accept their first offer. How many net acres do you have in Sec 18? You can get better terms, especially if you have quite a few acres.
Also, don't take the 2 year extension. That ties you up for too long. The first offers are usually lowball, just to get the conversation started. Read up on the forum and get informed. You want to make sure you don't warranty title, get a depth clause, get gross proceeds and not net (really watch out for that), etc.
Go up to the top of the page and read the material under MINERAL HELP. It will get you started. There are also some really good tips on the Garvin and Stephens forum. Scroll through the last couple of months. You are on the edge of the really good SCOOP play, but maybe in the Medrano and Hoxbar. Calvin is probably leasing for someone else and has been very, very active in the 4N7W area for over a year so something is coming. If you know any friends and neighbors, they might share their offers. They have been offering up to $600/ac nearby, so bide your time. Or you can wait until they force pool and take one of the offers then. Lots of ways to do it.
Hello everyone. I'm new to the forum. My mother wanted me to do a little investigating, as she has mineral rights passed down from my great grandfather. Recently, she and her siblings were asked if they wanted to sell their rights, and of course they said no. Since then she has received a check much higher than she has in the past. The property section is 28-5N-7W in Grady County and we have heard there has been drilling there. Does anyone have any current information regarding this area? I would appreciate any input. Thanks so much.
Last well I see in section 28-5N-7W is in 1982. The OCC website is down at the moment, so can't check there. What well is her check paying on and I can look it up that way. There is drilling in the area and things are heating up, so I wouldn't sell. Calvin has been leasing like crazy, so something is up. Bide your time and read the Grady, Garvin and Stephens forums to catch up on what is happening. Vitruvian just bought a bunch of Chesapeake acreage, so they are working on something. Your checks may just be up since the price of oil is up the lat two months.
Thank you so much M. Barnes. Appreciate the information. My mom just told me that they had received letters asking to buy their rights and then a company (Hal C. Smith) asked to lease their land after there hadn't been anyone leasing it for a long time. This is what makes her family believe something is happening there, and now from what you've told me, sounds promising.
Hal Smith leases under several names, I think Calvin is one of them. I would not jump into anything. Do a little reading and catch up. I have seen offers from $400-$600/acre in your general area. That will give you a ball park idea. You can lease or you can wait for force pooling. Good luck. So much leasing activity indicates some positive things are coming.
Help me get an idea about the general area your royalty is in and maybe I can help keep an eye on things as I travel around. Is it in the Rush Springs area? I live in 4n,4w south of Lindsay so I'm thinking it would be over that way.