Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on September 16, 2018 at 2:37

Thanks, Christie.  Can you share the terms of the lease being offered?  And the company name?  Any specifics would be helpful for members in that area.

Permalink Reply by Christie Jones on September 16, 2018 at 2:43

Just edited my post to include the other info.

Company: McGinty-Durham Inc/Great Southern ExplorationLC/ Agent: Thomas Scarbrock

Permalink Reply by Christie Jones on September 16, 2018 at 3:07

Terms are 4yrs 150 per acre - 18.75% royalty.

I also read in the Special provisions section of the lease :

Notwithstanding anything contained in the lease to which this supplement is attached, Lessor is to receive 3/16ths royalty, and wherever 1/8th royalty appears in this lease, is hereby deleted and 3/16ths royalty is substituted therefor.

Like I said, I am not educated in this area. What does that mean? I get 3/16ths and not 1/8th?

Permalink Reply by Skip Peel - Mineral Consultant on September 16, 2018 at 3:09

Thanks, Christie.

Permalink Reply by Lisa Melder-Johnson on September 16, 2018 at 3:49

Sounds low ball to me, because others in Vernon South have been offered $350/$500 an acre.  But this is big land owners 100+ acres.   Now this is hearsay. 

Permalink Reply by Christie Jones on September 16, 2018 at 4:08

I have not signed yet because I have not done enough research on all of the ins and outs of it all. I have also seen those figures. Only have 13 acres. In your opinion, would it be fair for me to ask for a little more money per acre?

Permalink Reply by Lisa Melder-Johnson on September 16, 2018 at 4:13

McGinty-Durham lease numbers 21851/21852 may be of interest on Sonris.   These are the 2 plots that was just sold for lease on the States sale on 9/12/18.  $150 per acre is what was paid to the State for their 39.86 & 80 acres with .1875.

Permalink Reply by Christie Jones on September 16, 2018 at 4:21

Thank you for the info! I have tried to find info on the company and have failed. I just do not know where to look.

Permalink Reply by Skip Peel - Mineral Consultant on September 16, 2018 at 4:23

The state mineral auction is a good resource because it is the only time you will find successful bids that provide the bonus per acre and the royalty fraction.  Since land and exploration companies no longer file full O&G leases in the public record, the auction is the only place you can get this type of information that is not a rumor.  The bid tracts are located in Section 18, Township 4 North, Range 5 West and Sections 26 & 35, T4N, R5W.

RAPIDES 18 T04N R05W	80.000	21851	MCGINTY-DURHAM, INC.	80.000		$12,000.00	$150.00		0.1875
RAPIDES 26, 35 T04N R05W	39.860	21852	MCGINTY-DURHAM, INC.	39.860		$5,979.00	$150.00		0.1875

Permalink Reply by Skip Peel - Mineral Consultant on September 16, 2018 at 4:14

Christie and Lisa, never hurts to ask as long as your request is within reason.  I know that is hard to know for the majority of mineral owners.  Details are important.  13 acres doesn't make or break the economics of a drilling and production unit, so it's not a priority.  It's value is limited compared to larger tracts. Although there is much buzz about the LA AC, that activity is a good bit further east in central LA and the Florida parishes.  This area is an outlier at this point with only one exploration and production (E&P) company showing interest.

Permalink Reply by Christie Jones on September 16, 2018 at 4:23

Thank you for your input it is greatly appreciated. I need any help I can get.

Permalink Reply by Skip Peel - Mineral Consultant on October 5, 2018 at 2:53

FTW, it is a relatively new discussion with no replies as yet.  When considering legal representation for anything associated with O&G above I-10, think where firms might be located that could do a substantial portion of their business in O&G related issues.  And therefore be on top of intel where leasing and early development activity is ongoing. The answer is Shreveport and the reason is the Haynesville Shale Play.

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