OKLAHOMA CITY — Two oil and gas companies have each paid more than $1 million for the right to drill on state-owned land in Oklahoma, the highest payouts for the state since at least 2011.
Paloma Partners IV, an operation by Houston-based Paloma Resources, has spent a total of more than $1.1 million to gain mineral rights in Kingfisher County, just northwest of Oklahoma City, The Oklahoman (http://bit.ly/2rRq4zv ) reported.
Another company won 40 acres of drilling rights in Garvin County at more than $13,000 an acre in February. And Tulsa-based Armor Energy LLC paid about $6,500 per acre in May.
“I don’t see those as extremely high prices or anomalies with what’s going on,” said Gib Knight, an industry investor. “Certainly, they may be above what has been common for some of the mineral owners, but typically (Commissioners of the Land Office) leases sometimes go higher because it’s a bidding process.”
Oklahoma made $22.5 million in 2016 by selling drilling rights, which doesn’t include production royalty payments. Drillers paid the state $83 million for leases in 2011.
Knight said that while the price of oil remains at about $45 barrel, the competition is increasing as private investors move in on the area.
Information from: The Oklahoman, http://www.newsok.com