Thanks to those of you who have posted and given of your time and knowledge on this group. I have learned a lot more than I knew several months ago. Because of that I find myself questioning a lease offer in the making.
My sister and I each own 19.89 mineral acres in S30, 14N, 12W and we have been offered a signing bonus of $750 per acre with 3/16 royalty on a three (3) year lease. That offer seems to be quite low to me. Am I correct in my estimation of this offer?
Thank you, Ginny
Only one lease has been taken in that area, so I would hold off for a while. First offers are usually low to the final offers. Personally, I would wait and see what develops. I think you are right that it is low. There are no current poolings in that township or the one to the west to judge by yet....
I've seen offers everywhere from $600 to $3500 over the last month in Blaine County on several properties I have. LOCATION, LOCATION, LOCATION.....All properties are not equally valuable throughout the county, and the target is not the same. Your particular location of 30-14N-12W would be on the far fringes of current Meramac interest. With regard to the Woodford, there is some good potential in your area, but it would definitely be on the gassy side of things. There have been some big gas wells, by Continental and others, off to your west a few miles.
You can always counter the option, and see how much higher they might be willing to go. Or you can wait, and things may improve as time goes on. The most important thing is that if you sign a lease, that you sign a good one. In a good area, you will make far more money over time from the royalty than you ever will from the bonus. In a weak area, the bonus may be all the money you get for a long time.
My sense is that quite a lot of the Blaine County minerals on the outer fringes are starting to receive offers from Newfield in the North, Continental in the South, and several other smaller players. Your property is not yet in one of the really hot areas.
Thank you gentlemen. I hope we can afford to wait it out a bit. What or where would be a source for me to seek out pooling information?