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Permalink Reply by Two Dogs, Pirate on August 3, 2008 at 13:12

If you signed a North Louisiana paid up lease form, its a one time deal, if you have a 2 year option to extend then they will pay you whatever was agreed upon to execise the option. If you signed a South Louisiana rental form then you will be paid what was agreed upon the second year and the years thereafter during the primary term of the lease or until a well is drilled.

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Permalink Reply by Snake Stewart on August 3, 2008 at 13:30

Mr. Scarbrock , Is that what the parishes signed ? The south La. rental ? I heard the second year of the $30,000 per acre Caddo lease included rentals of $15,000 per year after 1st year of none drilling .

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Permalink Reply by Two Dogs, Pirate on August 3, 2008 at 13:50

I haven't seen the lease but when when you go through the Department Of Natural Resources to put a lease up for bid that is what is required, a rental form. Their rules stipulate that the rentals will not be less that half of the original lease bonus.

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Permalink Reply by Snake Stewart on August 3, 2008 at 13:55

Wow. They play for real. Too bad I havent seen anyone capitalize on this same point from a landowners perspective. Is that pretty much a no go for us regular guy's ? Thank you for responding Mr. Scarbrock.

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Permalink Reply by Two Dogs, Pirate on August 3, 2008 at 13:57

I have used the form in North LA before. It would help the landowner by spreading it out over a period of time so that you wouldn't get nailed as hard on taxes in one year. Plus it may help the companys that are getting nailed by high bonus payments and having to sell off other assets to play in the shale.

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Permalink Reply by Two Dogs, Pirate on August 3, 2008 at 14:15

You might make more money in the long run if you chose to go this route. Save on taxes for one and get maybe $10,000 first year and $5,000 and $5,000 for second and third or maybe more. It is your land you chose the lease form.

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Permalink Reply by Snake Stewart on August 3, 2008 at 14:19

So a $20,000 lease could be split up into 3 payments 10/5/5 but would that be affected by drilling activity in year two ?

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Permalink Reply by Two Dogs, Pirate on August 3, 2008 at 14:34

You always run the risk of them getting to you before the time runs out and them not giving you all the money. It would depend on where your property is located. The companies want to spread their tax dept some to. It is not written in stone that the payment has to be like what Caddo did it, it could have been $30,000 times 3. I was told back 4 months ago by one of the landmen that works for the co I work for that his brother works for a major player in the Barnet and the price had gone to $25,000 a year and 26.9% and people were turning it down.

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Permalink Reply by Snake Stewart on August 3, 2008 at 14:42

Those guy's were pretty tough. With my luck I had better get it done in the first year and eat the taxes. I pull a stunt like that and I would get drilled and HBP on day two of my lease. Thanks for the informative discussion.

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Permalink Reply by Two Dogs, Pirate on August 3, 2008 at 14:54

For most in the shale the rental form would be the best thing. A lot of people on this site think that NW LA is the only place the shale exists they are wrong, the hot spot is going to be near the center of North Louisiana. Lets see what the holdouts get in that portion of the state, I think that NW LA is on the fringe. Go East Young man, go East. And to the South a bit.

Permalink Reply by GetSmart on August 3, 2008 at 15:30

Mr. Scarbrock, tell me more about how far east and south. My mother owns land in T20R1 in Lincoln parish. Is this the area you are talking, or further south??

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Permalink Reply by Two Dogs, Pirate on August 4, 2008 at 5:41

I would think that the hot spot will be South of you.

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