i have been offered 150 dollars an acre and 1/4 royalties for a 3 year lease on property in section 8, Caddo Parish, Louisiana is that the going rate ? thanks for your time kenny
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skip--- i understand from lessee they don't like short time leases, but as you said you can ask with some reasonable term and bonusyou never know until you ask--just like good lease languagre--- no ask no get
Skip--- I read on this site on many threads over last few years about small tract of minerals have little bargaining power and makes sense very large tracts in several thousand acres would have very strong bargaining power but in general in your opinion since you have negotiated many leases for operators before over many years, have many acres does the smaller owner need to have any bargaining power other that Lessees saying take it leave it or we simple leave you out? As you stated above 11.7 little to no bargaining power.
Adubu, a lot would have to do with the size of the unit. 11.7 acres in a 80 acre unit would be a large lease.
Yep, agree. However the number of GHS members with small acreage tracts who loaded up a list of non-standard lease clauses from reading the site discussions often fared poorly in the Haynesville Shale kerfuffle. One unleased member contacted me after their minerals were included in a unit with a well. They held out for a $10,000 acre bonus (at a time when offers had dropped to $2,500), wanted a quarter royalty until well payout and then 27.5%, a Most Favored Nations clause and a No Cost Royalty clause. He didn't get a lease offer and was surprised/upset. I asked him how many acres he owned? He said 5. It's quite easy for members to suggest tactics to squeeze every last potential advantage out of a lease. For many mineral owners that's not good advise. Sometimes the first lease offered is a good lease and acceptable.
Skip--- I agree 100% please don't missunderstand--- I would ask and if not received any thing better and with only 11-12 acres I would take the lease before it is taken off table and I agree bird in hand is better than 0.------- 25% R is good and if leases language is close but not everything you want but can live with it OK-- I agree he needs knowledgeable person to look at lease for him--- We are on same page--
THANKS FOR ALL OF YOUR IMPUT , I APPRECIATE IT VERY MUCH.
KENNY
Two Dogs-- yes understand 12 acres in a 80a. only unit is moderate/large size but today most of these Horizontal well units are 640 acres and most larger. So how many acres you need to have any power to negotiate? Or guess better question what % minerals in the unit do you need ? 12 in 80 = 15% 12 in 640 only < 2%
You need 80% leased in Louisiana. Some folks ask for things that are way out of line. A lot of old timers will remember their parents getting a clause saying that they can have use of the natural gas for use in their home. Others want to have permission to access the drill floor and all the well logs and information. While others may ask for a favored nations clause. Most of the stuff is for them to have bragging rights over everyone else in the unit for getting something others didn't get. A good lease will have horizontal and vertical Pugh Clauses, no cost royalty, limit the term of shut-in, no salt water disposal and damage clauses that would provide $XXX amount for surface use or no surface use at all depending on the situation.
"You need 80% leased in Louisiana."
I have heard this dozens of times, but I can't find anything in Louisiana's law that says this. In fact, I seem to remember hearing that one operator in the Haynesville 30:10'ed a lease coalition that made up 45% of a unit. While that sounds like a tall tale to me, I still don't know where the 80% requirement is coming from. TD,P, do you know of a statute or code article that says consent of 80% of owners is required to pool?
Mineral Code Article 175 is the only place I could find the figure 80% anywhere, but that article deals with the minimum consent among co-owners of a mineral servitude for one of the co-owners to conduct operations. Perhaps that's where people are getting the idea that 80% of the owners have to agree to be force-pooled. Considering that the pooling is "forced," I don't see how their consent would matter.
Correct, 80% of undivided interest in a tract is required for development to go forward. My attorney explained this to me after I had called the Office of Conservation and asked the minimum acres under lease to apply for a unit question of the division's attorney. Once I had confirmed that there was no minimum and thought about it for a while I came to the understanding that market forces drive unitization. No operator would be likely to form a unit with a large number of open interests considering LA mineral law. They certainly would not drill it with that many non-consent interests.
Shale drilling and lithium extraction are seemingly distinct activities, but there is a growing connection between the two as the world moves towards cleaner energy solutions. While shale drilling primarily targets…
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AboutAs exciting as this is, we know that we have a responsibility to do this thing correctly. After all, we want the farm to remain a place where the family can gather for another 80 years and beyond. This site was born out of these desires. Before we started this site, googling "shale' brought up little information. Certainly nothing that was useful as we negotiated a lease. Read More |
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