Replies to This Discussion

Permalink Reply by Stacy Fife on March 14, 2012 at 6:44

Thanks for the information.

I couldn't get anything from that link.

Permalink Reply by Skip Peel - Mineral Consultant on March 14, 2012 at 7:00

2 - INLAND

42521 CLAIBORNE, UNION 1, 10, 11, 12, 13, 14, 18, 2, 3, 35, 7 T22N, T23N R03W, R04W 47.0 Acres offered PETROLEUM PARTNERS, L.L.C. 47.0 Acres bid $15,322.00 $326.00 (bonus per acre) $7,661.00 0.205 (royalty)  

42522 UNION 10, 11, 12, 13, 14, 15, 18, 19, 22, 23, 24, 7 T22N R02W, R03W 42.0 PETROLEUM PARTNERS, L.L.C. 42.0 $13,692.00 $326.00 $6,846.00 0.205

42522 UNION 10, 11, 12, 13, 14, 15, 18, 19, 22, 23, 24, 7 T22N R02W, R03W 42.0 THEOPHILUS OIL, GAS & LAND SERVICES, LLC 42.0 $21,000.00 $500.00 $10,500.00 0.20

Tract 42521 is in the vicinity of SWN's Southwest Lillie Field L SMK Unit in Sections 14 & 23 - 23N - 4W.

Permalink Reply by obed w odom on March 15, 2012 at 6:43

It seems that Theophilus (SWN?) wanted tract 42522 pretty bad to raise Petroleum Partners' bid by $174 per acre, but they didn't breach the 0.20 cap on royalty interest. Looks as if this tract is near or maybe partially included in the proposed unit for the SWN well near Grafton's Crossing.

Permalink Reply by Skip Peel - Mineral Consultant on March 15, 2012 at 7:54

obed, these are "sealed" bids submitted by mail.  It's not a "live" auction although you can access a live audio of the bids being opened and read aloud.  Therefore Theophilus was not raising Petroleum Partner's bid because no one other than PP knew the bid until it was unsealed and announced. 

http://dnr.louisiana.gov/index.cfm?md=pagebuilder&tmp=home&...

Permalink Reply by The_Baron on March 16, 2012 at 3:52

Yes all bids are sealed and due to OMR the day before. They are opened at the open meeting of the Mineral Board.

 

There are many strategies used in these auctions, the most common are the odd royalty rates. Many times the board will favor a higher royalty over bonus, thats why you see 20.5%.

Permalink Reply by Sarah Randolph on March 15, 2012 at 7:43

RE: the bidding for tract 42522, I thought at least a part or some sections were already leased.  So is someone who has already leased from the mineral owners trying to bid to other companies?  Or am I confused?

Permalink Reply by Skip Peel - Mineral Consultant on March 15, 2012 at 8:02

Sarah, these are "public bid tracts".  Not private lands but those owned by some public entity.  It could be the state (beds of streams and lakes), the parish (road rights-of-way), the local school board or levee district or even the local volunteer fire department.  The Mineral Board handles the public auction for these public entities upon their request.  A state lease has a standard lease form and is good for one year at the bonus bid.  If not developed within that 365 days, the lessee must pay one half the original bonus bid to extend the lease term for an additional year.  There are two points to consider:  these public bids are the only place in the public record where you will find bonus offers and state leases are normally among the last leases acquired before an energy company starts drilling owing to the one year term.

Permalink Reply by Sarah Randolph on March 15, 2012 at 11:02

Skip, thank you for your reply.  I think Cabot has leased in this area along with SWN so maybe someone was bidding on their behalf.  Regardless of who the bidders represent sounds positive for those mineral owners in tract 42522.  At least I am hoping.

Permalink Reply by Skip Peel - Mineral Consultant on March 15, 2012 at 11:08

You will not see Southwestern or Cabot or any O&G operator as a bidder in a state auction excepting rare occasions.  They all use land companies to represent them.  Later the land company will assign the state lease to their client and it will show up in the public records of the appropriate parish or county.

Permalink Reply by North LA on March 14, 2012 at 7:08

I think I fixed it.

Click on 3/14/2012 and then hit submit

Permalink Reply by courtney oliver on March 14, 2012 at 7:10

Was there any leases in Morehouse or West Carroll?