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Oil/Gas/Payne County, OK Lease Offer


QUESTION: What is going rate. Call offered 350 acre Royalty 1/8 for Payne County Oklahoma Section 2 and 11 18N 2E I believe. Not sure number yrs lease is for. Any help greatly appreciated as I'm in California.

ANSWER: I think you should be able to get $300/acre and 3/16 royalty in this area. I'd shoot for at least that. 1/8 royalty is not good. Take a little less money if necessary and get the 3/16 royalty. I'd also make sure the primary term is no longer than three years. If they want an "extension option" for another two years put in there I'd either get them to agree to pay you double if it's exercised or just not agree to an extension at all.

Hope this helps you out.
Frederick M. "Mick" Scott CMM RPL
The Mineral Hub

---------- FOLLOW-UP ----------

QUESTION: They offered as much as 1/4 royalty but lot lower per acre. She quoted 175 acre and 1/5 royalty. So I guess the 1/4 would be about 100. We did get offered what you mentioned 300 and 3/16. We have a issue, my Mom is in home and will more than likely take money. So would we be better off taking 100 acre and 1/4 royalty as she will be 89 in Dec.

If the home finds out about the bonus money, then they'll likely want her to sell the mineral rights too in order to help pay her medical costs assuming she's receiving aid from the state for her stay there.

I'd stick with 3/16 and (at least) $300/acre. You might talk to an "eldercare" attorney about what the home can and can't take before having her sign the lease. Perhaps he/she can better inform you as to what bonus amount to go for.

Hope this helps you out.
Frederick M. "Mick" Scott CMM RPL
The Mineral Hub  


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Frederick M. Scott


Oil and gas leasing, lease negotiations, how to best deal with the oil and gas companies or their representatives, buying/selling mineral rights, forced-pooling, correlative rights, deeds and conveyances, and "post-production" costs. I am most experienced with Oklahoma properties and laws, but am able to answer questions concerning other oil and gas producing states in many cases.


I am a Certified Professional Mineral Manager (CMM) certified by the National Association of Royalty Owners (NARO) in Tulsa, OK. I am also a Registered Professional Landman (RPL) with the American Association of Professional Landmen (AAPL). I have managed my family's oil and gas properties in Oklahoma for over 10 years and have dealt with many landmen, title analysts, attorneys and other oil and gas professionals in the process. I have written several articles which have appeared in various oil and gas industry magazines and newsletters. I have negotiated and drafted leases, prepared deeds, affidavits, and other legal instruments relating to my own minerals, as well as performed title, legal research, and curative work for same. I have acquired a good deal of knowledge on the subjects of oil and gas law, mineral appraisal, and landwork over the past ten years, and also worked as a professional landman and lease buyer for a time. I've seen the business from "both sides" and therefore feel confident I can help out most of the folks who ask questions in this forum.

National Association of Royalty Owners (NARO); American Association of Professional Landmen (AAPL)

National Association of Royalty Owners "Action Report" (ROAR); NADOA Magazine, The Mineral Hub, Landman Magazine, and several royalty owner association group's newsletters.

Certified Mineral Manager (CMM), Registered Professional Landman (RPL)

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