Checking on lease offer terms from Gulfport for Stephens County: Herro 1-23X25H, Section 25-2N-5W. Lease offer terms are: 1) $1,600 nma with 1/8th royalty, delivering 87.5 nri for 3 year term; or 2) $1,350 nma with 3/16ths royalty, delivering 81.25% nri for 3 year term; or 3) $1,200 nma with 1/5th royalty, delivering 80% nri for 3 years. Anyone doing any better? Any negotiating room? Also, I’m not familiar with the “earnout” concept. How does that work?
Most savvy mineral owners would want the higher royalty since it usually far outpays in royalties over time with successful wells-especially if there are infill wells down the road. Always wise to have a good oil and gas attorney review the lease as the drafts are rarely in the mineral owner’s favor. Cannot comment on the “earnout” without seeing the whole wording. Ask the attorney.
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