Replies to This Discussion

Permalink Reply by Finnbear on October 11, 2011 at 6:50am

The total is an important consideration to the next group negotiating in the area because it establishes a "market price" of what the O&G was willing to pay to obtain the lease. They can work with that number and incorporate their fee structure (if any) and get an idea of what the landowners may receive in the future.

Permalink Reply by scott peterson on October 11, 2011 at 5:39am

Paid by the O & G not by landowners.

Permalink Reply by scott peterson on October 11, 2011 at 5:38am

Cant say publicly Tom, but I can say it is extremely good all the way around!

Permalink Reply by 09bp5t05myjl3 on October 11, 2011 at 5:55am

I'm confused are we talking about the same offer , the $4,800 or $5,000 at 20% gross! is that with KWGD or is it differene with CARRIZO oIL thru Homeland??

Permalink Reply by scott peterson on October 11, 2011 at 5:58am

tom i friend req you

Permalink Reply by 09bp5t05myjl3 on October 11, 2011 at 6:01am

Thanks Scott I accepted

Permalink Reply by scott peterson on October 11, 2011 at 6:03am

Nelson beat me to it.  Carrizo/Homeland is different than the KWGD deal.

Permalink Reply by Nelson Roe on October 11, 2011 at 6:02am

Carrizo & Homeland is a different group with a different offer than what we speak of with KWGD.

Permalink Reply by 09bp5t05myjl3 on October 11, 2011 at 6:13am

does anyone know the fee structure for Homeland, I'm hearing that the fee is 5% of bonus & 1% of Royalty (not 1% of the 20%) but 1% off the top so landowner pays $250 per acre & really only gets 19% gross? is that correct?

Permalink Reply by Finnbear on October 11, 2011 at 7:22am

If so, they are getting 5% of everything, both pre and post drilling since 5% of 20% is 1%. By entering into a lease with those terms and assigning them a royalty interest, you are making Homeland a lifelong business partner. What are they going to do for you down the road to earn that royalty interest? Will they be in business that long? What happens if they go out of business - who collects that 1% (5%) royalty?

Permalink Reply by Nelson Roe on October 11, 2011 at 7:30am

If I remember correctly that is the structure for Homeland.  However as I said previously, KWGD does not take anything from the landowner royalties.  Their fee is a one time fee which in this case is being paid by the O&G company.

Permalink Reply by V Miller on October 11, 2011 at 7:47am

Can anyone disclose who the O&G company is behing the KWGD group?  Gulfport??

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