Hi All-
Our family owns 75 acres in Kingfisher Cty, OK. We all just received Lease/Bonus offers from two different drillers (Chaparral Energy and Ovintiv) for Section 14-17N-07W. There was a big meeting at the OCC late last month based on Chaparral’s court filings to drill. Ovintiv came and filed a complaint that they should really be the entity awarded the drilling contract. Our previous Lease Bonus agreements with Newfield (Now Ovintiv) for $3125/acre all expired in August. Here’s the new offers:
– Chaparral Energy: $450/acre + 3/16 royalty OR $400/acre + 1/5 royalty
– Ovintiv: $800/acre + 3/16 royalty
All family members are looking to me to know what to do. No one is answering my calls at either company.
Do we just wait now to see who wins??? Two family members signed with Ovintiv right before the Chaparral filing notices came to us by mail.
No need to be concerned. This happens all the time. Personally, I would ask both of them what their highest royalty will be and then negotiate the best lease clauses I can get. The draft they send you will not be in your best interest and will need some work. Or just wait until pooling and go with the operator. It is likely that you might get third party offers to lease as well.
I have had dealings with Ovintive and I can’t recomment them. Outright lies and pressure tactics from the start until I pushed back. They told me my royalty was forfeited to the state, then they told me I wasn’t in pay status and they would probably want an ancillary probate, then they started making law out of whole cloth saying I was being treated as “Unleased” because of loose language in the North Dakota Century Code where I’m certain the lawmakers meant Non-consent but substituted “unleased” As the lawmakers didn’t flest out “unleased” with authorization to take and sell hydrocarbons or to take money to apply to the cost of drilling and completing the well until it is paid off and my family becomes working interest owners. It was intentional, not just a landman with a rush of brains to the head I talked to others there. Strangly, they did decide I was in pay status, no ancillary probate needed and I didn’t have to go out of pocket over 1.5 net acres…but they tried and forced me find a way to put them in check, and that makes all the difference in the world. If it were a choice of Ovintive or one that hadn’t tried to bleep me yet? I’d take the other one.