"Big Money?"
I still don't find many in the Blanchard area who have actually pocketed or deposited 15-20,000 per acre on their lease bonuses. Great offers are still out there and being rescinded every day for 10K, 9K, and 8k per acre with good royalty percentages. People holding out in Sections where majority of minerals are under lease and drilling permits being applied for could soon see the size of these bonus offers shrink significantly or the offers disappear completely.
Views: 136
Replies to This Discussion
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Permalink Reply by Bobi Carr ("parker") on -
Just another scare tactic.
I myself do not want to be force pooled, but if I had a landman telling me this line a would just as well wait for the well to pay out.
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Permalink Reply by SharonB T18N R15W S8 on
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Oh I'm so scared.... I may actually have to ride the well down instead of leasing.
I ran some figures last night for my 9.7 acres. I used a 10 year pay out on a mega well (I can hope for a 16 Mcfed well), with 70% decline in production after 1st year, 20% after 2nd year, and 10% for each year thereafter. I included my fractional cost of a 6M well and 15% production cost off 100% revenue. I compared that to signing 30K/30% cost free royalty on the same well.
As an unsigned landowner I could make 1.5 million in the 1st 10 years.
As a leased landowner, even with 30K per acre bonus, I could make 859,044. So that's a difference of 659,817 for just the first 10 years.
So please, keep trying to make me believe the offers will continue to get smaller....I have no problem riding the well down and making more money.
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Permalink Reply by GetSmart on
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Sharon, first I want to say that I am an unleased landowner of 17 acres myself, so I am not a landman trying to scare you. However, there are three items that you should consider in you calculations.
1) The time value of money. You could invest the lump sum bonus money with annual compounding and offset some of the difference. You may have more time that me to do these calculations but they will be signficant over a 10 year span.
2) Taxes. You assume all taxes will be the same from now until 10 years from now. If Democrat is elected be prepared for taxes to increase.
3) Risk. You hope that your well will be 16Mcfed, but if it not; you will reduce your risk with the up front money.
If I were offered 30K/30% cost free royalty, I would sign today. I'm just not hearing of any offers this high these days. God Bless You and Good Luck!
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Permalink Reply by ez on
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i would not want to be unleased but im not taking 5 or 6k when i know there are others that are getting over 20k thats just buss. be like them giving me 50% no cost royality. not gonna happen and i understand why.
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Getsmart - Thanks for your thoughtful post. I did not factor in taxes...they are what they are at the time I pay them. I just wanted to look at the income difference over a 10 year period. Good point about the investment potential of the lump sum, and I suppose that would be one tally mark for the pro side of signing a lease. And the reduction of risk is a good point too. Those are the most valid reasons for signing. But this scare tactic of "take this offer now or you'll miss out" is getting old already.
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I can't figure out the deal with low leases around Blanchard. I live on the lake and best offer by CHK was $7500/ac. (Manna) at the same time that CHK (Manna) paid the state $14,500/ac. for the lake bottom. The south side of the same lake has always been double the lease bonus offers. Go figure...we just "country" out here.
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Permalink Reply by Snake Stewart on
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Come on KB ! They had an O&G meeting and decided amongst themselves that they just weren't going to pay a lot of money per acre so we might as well close up shop and take what they decide to let us have out of the goodness of their hearts.They are pulling up stakes and leaving the countries largest natural gas field and going back to the Barnett Shale where they have to pay much bigger bonuses for less production !HA!HA!HA!HA!HA!
We just had a meeting too ! We don't give a big whoop how they feel about paying big bonuses. The peasants are gone or have someone looking out for them. Try some new material O&G's. You have played that song and dance to death !
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Permalink Reply by ETOilman on -
They had a meeting....what they? You have played the antagonist to the oil companies to death yourself. YOU are convinced that ALL oil companies are out to screw the landowners.
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I am kinda new to this but what exactly would YOU call it E.T. ?
Only think the ones on the Haynesville Shale play are trying to gouge me. And the guy's refineing gas. We can't leave out Hugo and his anti American booty.Other then those guy's I don't think they are ALL trying to consumate me!
Although I may be antagonistic toward O&G's it certainly didn't start until 6 months ago. They have been using these same techniques for decades. Heck , 6 months ago I woulda' thought a landman was somebody that mowed yards !
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Permalink Reply by Margaret Wren on
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I guess you must be certified by now cause I KNOW you mowed a yard(field) or two in your days lol....
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Permalink Reply by ETOilman on
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Having been a landman for over 27 years, I have always tried to be forthright with EVERY landowner. I have had parameters within which to work, ie...bonus money limits, term and royalty, but I have always strived to be honest with the land and/or mineral owner. We as landmen are sometimes limited with our ability to make decisions based upon the money, royalty and terms. I have always enjoyed negotiating with the landowner and have many fond memories doing so.
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