Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on October 7, 2013 at 10:46

mark, I have no idea whether the address listed is a physical business location or the office of the corporation's agent.   Could be either as both the agent and officer list that address.  There is no requirement by the LA SOS of which I am aware that corporations list a "business" address.  If this is an accommodation address of some kind it's not illegal and is quite common for corporate registrations.  What is of some significance is the fact that the corporation is registered with the SOS.  I usually look to see the date of the registration as that can be an interesting fact to consider.

Permalink Reply by George Christopher Henson on October 7, 2013 at 10:26

Skip, It's the second offer to buy outright. The first offer was considerably less.

Permalink Reply by Skip Peel - Mineral Consultant on October 7, 2013 at 10:56

George, if this is an offer to purchase mineral rights, it should increase over time as long as development continues in a positive direction.  Minerals worth x last month may be 1.2x this month because they were included in a drilling and production unit.  If an operator were to permit a well for that unit they might go to 1.3x.  And if a well was actually spud in the unit it could be 1.5x.  If the well is sufficiently productive the minerals might bring offers of 2x.  If that well does not meet certain ROI requirements the operator may not drill any more.  Then the worth of the minerals might be 0.5x.  Or 0.0x.  It's all about recognizing and managing risk.  Worth, or market value, is what a buyer is willing to offer that a seller is willing to accept.

Permalink Reply by Steve on October 7, 2013 at 15:37

I have heard of mineral rights being purchased in that area for $5000 per acre recently. I know of one such transaction for sure. I am guessing this is the case with the Lucy offer. I have not heard of any bonus offers anywhere near that price per acre per year but I suspect that will eventually happen if the play is proven commercial.

Permalink Reply by mark edward marchiafava on November 11, 2013 at 9:09

does anyone have a PHONE NUMBER for this elusive "company?"

Permalink Reply by George Christopher Henson on October 7, 2013 at 10:19

Depends on your status in the game. If your leased, in a unit, with permits applied for, and rumors of 5000 bbls possible production per acre, $3000 is chump change.

Permalink Reply by mark edward marchiafava on October 7, 2013 at 10:23

Not leased at this time, have had ZERO offers in north central Amite county and glad of it !  Just trying to figure out how to BEST capitalize on a once-in-a-lifetime opportunity.

Permalink Reply by Oilman28 on October 7, 2013 at 10:33

I think there is some confusion here. I agree with Skip that this offer was for the acquisition of minerals and not a lease. Mr. Henson stated that he was already leased. It sounds like the mineral buyers are hitting up acreage in units that are being permitted. $3000/ac actually seems high for minerals in the TMS concidering the minimal success it has experienced so far.

Permalink Reply by Bernell McGehee on October 7, 2013 at 10:52

Mark,

You are unlikely to get much above $300 per acre for a lease as things stand.

AND, even if the play is proved commercial, under Mississippi law the operator won't pay you more than they have paid anyone else.  There would have to be a third party/investor to lease the property.  Right now, to my knowledge, no third party is leasing in the TMS.

Offers to purchase minerals at $3,000+ under selected permitted sites have been made by more than one company.

Permalink Reply by Steve on October 8, 2013 at 4:27

As of today, the Huff well is still almost 4000 ft. from reaching total depth due to rig mechanical problems. Hopefully they will finish drilling this well within a week or so and can begin fracking. A new rig to drill in the Weyerhauser field in La. is expected to show up shortly.

Permalink Reply by Charles Bell on October 8, 2013 at 5:48

Thanks Steve.

Permalink Reply by Oilman28 on October 8, 2013 at 8:56

It's one well after another with issues. Not good!

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