Anyone know of current leasing activity/offers in Cass County?

We own mineral interest in Cass County ( R. Kimbrough Survey) and have been recently contacted by a landman indicating he was working on behalf of Pegasi Energy.  An offer of $175/acre, 3/16 royalty for 2 yr term was made.  I see that Pegasi has had favorable results in Marion County w/ Norbord Well # 1 (just a few miles south of us) and looks like they have commissioned a new pipeline in the area too.  Anyone know of current lease offers in this area?

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Slem,

I am unaware of any lease offers.  I have property in the Linden-Kildare area which Anadarko leased some 4-5 years ago.  I am glad to hear there is activity.  Do you know what zone the Norbord Well was completed in?

It was in the William Archer Survey in the Jefferson area.  I believe it was drilled to a depth of approx 7000 ft in the Travis Peak formation.

I was told last week by a leasing agent that offers would not exceed $200 an acre.  I will not lease for that amount.  I think I learned a lesson by leasing my Louisiana acreage for that amount and my neighbor got 100 times that amount per acre. 

I am looking at gas and oil. 

I understand Pegasi has been leasing up acerage near Kildare. Not sure what they plan to do. But I've heard of, though cannot verify offers in the range of $225 and 20%. Not a real hot area now, from what I hear. You may be faced with a choice of leasing for low bonuses (mostly on account of gas being in the high $3 to mid $4/mcf range for the foreseeable future) or holding out and not leasing until natural gas prices go up again (which may take years as a great deal of gas in coming on the market now).

My client owns surface and minerals in Cass County.  He has been offered $150 bonus and 1/6 royalty for a 5 year lease.  It is suggested that the lessee has put together a lease block of several thousand acres.  We suspect their target is upper Cretaceous oil @ 6-6,500'.  Has anyone leased or been offered these terms in Cass County?  I recommended the client decline.

I heard on grapevine that Unit Petroleum through brokers were the Lessee at $150/ 5 year/1/6 and looking at Smackover Oil Play, but temporary stop any activity about 2 weeks ago and will be back "later"

My family owns minerals in the Ebenezer Frazier survey and was offered a lease last week by Genesis Land (agent for Calston Exploration) at $125 per acre, 1/6th royalty, 3 year term and 2 year option at $100 per acre. I've researched activity in this area and there is not much going on. Stroud Petroleum is somewhat active in Cass, so I contacted them and they are looking at the acreage. I suggest you contact them as well. Recent leases in the county according to Drilling Info have gone for a 1/5th royalty, so I plan to concentrate on getting that rather than worry too much about the bonus. The real money is in the ground anyway and I don't see bonuses getting much higher, maybe $200.

Ben - Read my comment below. Any progress on your dealings with Calston Exploration? Where is your land located? My concern in leasing for that low amount would be the increased interest in the Lower Smackover Brown Dense. The wildcat drilled in 1982 went to this depth and produced. Just wondering if the lease price should be more with the improved technology and results with horizontal drilling. Any input would be appreciated.

We went back to Calston and asked them to increase the royalty and bonus, and they offered $200/acre and 1/5th, which my family decided to accept (my uncles have the ultimate call).  The problem with pointing to the LSBD is that there really has not been any focused LSBD leasing activity in Texas yet that I know of, so there really is not a market yet for leases.  What I mean by "focused" is where the companies are not secretive about why they are leasing you, like happened in the Eagle Ford and Haynesville shale.  If you feel strongly about it, you might just hold out and wait for the activity to pick up.  I went on the RRC GIS map, and did not see any well in the Abstract you identified.  What is the name of the well?

I own mineral interest in Cass County also (James Taylor Abstract No. 1034). I recently was contacted by a Landman working on behalf of Calston Exploration with an offer of $200 /acre, 1/5 royalty for a 3 year term. There was a wildcat drilled in 1982 at around 11,000 feet that tested out at 3000 mcf and produced at 2050 mcf for several years but was shut in due to lack of demand. The land is located about 6/7 miles northeast of Three states. With a known producing well, this seems like a lowball offer. Any one else in this area been contacted? I have not responded yet to the lease offer.

I am curious about the land you reference 6-7 miles NE of 3 States...is there a nearby town?

Rebecca - It is off Hwy 77 near Smyrna Community, just south of Atlanta, Texas.

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