Seismic Permit Question
We have about 500 acres under lease with Southwestern Energy. The lease has been in place a little over a year. Over the past month a company named Diversified Land Management has been sending multiple requests for authorization from us for a seismic permit for the land. They say they are working for Seitel Corporation. Why would they be doing this? Is there normally a fee paid for the right to do this? Any insight would be helpful.
Thanks... jay
Thanks... jay
Views: 1326
Replies to This Discussion
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Permalink Reply by Les Bamburg on -
Jay, that seems to be the going rate.
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Permalink Reply by jr on
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a co. named veritas is conducting a 500 square mile seismic in n natchitoches parish and sabine. we met with them last week and was paid $25.00/ acre
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Permalink Reply by Henry on
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jr,
Would you be willing to elaborate on your $25/acre payment? I ask because I signed with veritas for $15/acre, but I had a favorite nation clause. Did you sign for $25/acre or was it $15/acre for the permit and $10/acre for "damages." Thanks, in advance.
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Permalink Reply by adubu on
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Henry--most are flat all inclusive $/acre. Seitel is shooting 3-D in Martinsville East Texas area. The initial offer was $15 which is standard for them I understand but will pay $25 if ask but I know of no one receiving > 25. Most of the 3-D is looking at deep shale and lime.----- Jay W ----Since you are leased with SWN you should ask if they ordered the shoot if not Seitel will tell you who contacted them to do the 3-D on your minerals. I am all for them shooting 3-D it can help improve odds for your deep minerals to get drilled. Also the reverse of kill can happen but at some point the operator will want to know before drilling so the sooner the better. In your case if nothing has been drilled before on your minerals they will look at all formations. The seismic will improve odds to make best well possible if gas or oil is there.
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Permalink Reply by ken hatcher on
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Henry. I signed last thursday with Veritas. Was the 15+10 method.
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Permalink Reply by P L Campbell on
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What do you mean exactly? If you collect it in damages, not actual seismic permit, then you do not have to pay income tax on the damages? I'm new at this, I'm learning.
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Permalink Reply by adubu on
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pamela---damage to your property is a deducible event on your property's value not income therefore no taxes due. The permit fee like a lease bonus is a asset income so therefore taxable-- discuss with your accountant. If you receive a 1099 from the seismic company it should show the income value to you as "other income" box # 3 then give your accountant copy of seismic ROW agreement you signed. Explain to accountant that this payment is for damges to your property during the shoot. It's possible you may not even get a 1099 from them so if not nonevent on your tax return but make sure your accountant know about it because when he sign return he is saying and certifying all information on the return is complete and IRS could get him for a falsified return as well as you
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$15 per acre $10 pre damages. we also had the favored nation clause put in along with two pages of other exhibits.
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Permalink Reply by Spring Branch,mineral owner on
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I think it is broken down in the $15 + $10 ....total: $25 for tax purposes.
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Permalink Reply by Bobi Carr ("parker") on
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jr,
Would you care to disclose some of those clauses.
Some I've heard are get check when the agreement is signed.
Have a definitive ending date not 18 months.
If you farm the property put a damage fee for leaving gates open.
Also address hay cutting. (Cables not present during raking and bailing, etc.)
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Permalink Reply by jay w on
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thank you very much for the insight. The strange thing is that Diversified Land claims they have been trying to track us down through old bank records etc and is has taken a long time to do so. If they and or Seitel was working with Southwestern, Southwestern could have just given them our address and phone number. Would we even have the right to provide authorization to a gas company other than Southwestern to prospect with seismic since Southwestern has the lease for almost another 2 years?
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