Ominex Petroleum and Black Raven Energy are both working to secure oil & gas leases in Phillips County, CO. Join the Phillips County Oil & Gas Group at MineralRightsForum.com and discuss your lease offers and where you see activity. The area has been on again, off again for leasing over the years and drilling has never taken off. Hopefully, that will change this time around. The Niobrara is nearest producing formation and it is targeted at shallow depths and produces biogenic gas. More drilling has taken place to the south in Yuma County, Colorado, but for Phillips County it isn’t clear if the target of leasing is the Niobrara or another exploration target. There haven’t been many deep wells drilled in the area that test shale gas or oil production. Keep an eye out for drilling rigs. A rig will be the signal that operators are getting more serious.
July brought another wave of oil and gas lease offers in Phillips County with Fort Worth, Texas-based Omimex Petroleum offering leases to many mineral rights owners east of Holyoke. Black Raven Energy, Inc. has also been working to expand operations in Phillips County. Having secured several oil and gas leases earlier this year, Black Raven Energy, Inc. submitted 17 new well permit applications south of Amherst in the month of July.
While oil and gas leasing is not new to Phillips County, the actual drilling of multiple wells and gas production is. Over the past several decades, farmers have routinely accepted bonus payments from oil and gas companies for signing oil and gas leases, but rarely have these companies been heard from or seen again.
Today, things have changed in Phillips County. Within a few short months of signing an oil and gas lease, the gas company may actually begin the steps to drill a well on your property, and before long you may be navigating the tractor around a well pad in the middle of your field if you haven’t taken the steps to negotiate a more favorable oil and gas lease.
Most mineral owners will be presented with what is commonly known as a producer 88 oil and gas lease. While this lease may be standard for the gas industry, this lease should not be your standard as a farmer or the standard for gas leasing in Phillips County.
These leases allow liberal use of the property for the development of natural resources. Rarely, if ever, is signing a standard producer 88 the advisable course of action for a landowner.
Before signing an oil and gas lease, you need to evaluate the impact of gas developments on your farming operations. There are two main financial incentives in signing a lease: the bonus payment for signing the lease and royalties if gas is produced.
Read the full news release at HolyokeEnterprise.com