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Oil/Gas/fair oil lease price

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Question
We live in Midvale Idaho 83645. Oil has never been produced in this area. We are being offered $4 per acre for a 5 year lease. Does this sound fair

Answer
Your negotiating power depends on a few things including the size of your land, the proximity of existing production and the results of any seismic activity in your area.  Also, depending on how "hot" an area is the price can vary greatly.  Do not rush into anything until you have done your research.  I would solicit bids from a couple of more companies and see what they offer.  Also, you can go to the website below and find the nearest production to your land.  Finally, if other people in your area have recently signed leases you can ask them what they were offered.  Good luck!

http://www.idl.idaho.gov/bureau/Minerals/min_leasing/iogcc.html

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David Traugott

Expertise

I can answer questions related to the technical issues associated with the drilling and completing of oil and gas wells; very familiar with the cementing process, LWD tools and Coiled Tubing operations. Limited knowledge of mineral rights and/or royalties.

Experience

Seventeen years working as an engineer in the industry both in the field and in the office. Field locations include offshore, land, and overseas. Office locations include Lafayette, LA and Houston, TX.

Organizations
SPE, AADE, IADC, API, IEEE, ICoTA

Publications
SPE Drilling and Completion Magazine, World Oil, Harts E&P.

Education/Credentials
Bachelor of Science in Electrical Engineering, UL Lafayette 1995. Strategic MBA, University of Houston-Victoria 2010

Past/Present Clients
Major and Independent Oil and Gas Companies.

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