Insights

Insights

December 31, 1969

Camille Nichols

Recent Posts

Four Big Mistakes Made by Mineral Buyers

By Camille Nichols Acquisitions & Divestitures

Title due diligence in certain transactions may seem like an onerous part of the deal, causing some to speed through it and overlook critical issues. Your due diligence process is the most effective insurance policy against title busts and loss of mineral value.  However, in our experience, we have seen some big mistakes made by mineral buyers that generate big regrets down the line.

Here are four big mistakes we see made all too often:

  1. Overlooking Location-Specific Risks
  2. Not Getting the Executive Rights or Other Rights to Lease
  3. Acquiring Partial Rights Only
  4. Skimping on the Diligence
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Spotlight on the San Juan Basin

By Camille Nichols Land Management, Acquisitions & Divestitures

The San Juan Basin offers many investment opportunities, as it contains the largest coal-bed methane field in the world and ranks second in total gas reserves. This spotlight provides geological facts, current activity and things to know beforehand.

Background

The first oil well in the San Juan Basin spud in 1911, and since then over 40,000 wells have been drilled. Drilling activity was steady from the 1990s until 2008. In 2007, there were over 40 active rigs. Then attention turned to the prolific Marcellus, where gas could be extracted less expensively. Today, there are four rigs running—BP has two, and WPX and Red Willow Production Company each have one.

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Regional Land Title Issues You Can’t Afford to Overlook

By Camille Nichols Land Management

Successful dealmakers and investors understand the value of getting the right information to evaluate a new opportunity. Likewise, in the oil and gas space, having a solid understanding of a prospective investment play will enhance the quality of the assumptions and help set realistic expectations. This is particularly true when it comes to mineral title, land title and other regional title issues. An informed buyer will always conduct an assessment of title complexity, potential ‘red-flag’ issues, and the length of time it will take to confirm title.

Questions that should be asked, for example, are:

  • How old is the title and what kind of access information will you have to work with during due diligence?
  • What are the costs associated with title due diligence and title curative?
  • How hard will it be to obtain fill-in acreage or hold on to your acreage post-acquisition?
The answers to these questions will vary widely and differ from state to state, or basin to basin, so obtaining the targeted information is important.  Our regionally-focused teams across the United States collaborate with clients to provide this kind of insight at the outset of a deal and throughout the asset management process. The following highlights a sample of common title characteristics of three of today’s most active regions.  
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Oil and Gas Land Management Can Make or Break Your ROI

By Camille Nichols Land Management

For energy professionals and investors with limited experience in the business of oil and gas land management, the details can seem daunting, or worse, be treated as an “afterthought” to other steps in the E&P value chain. The simple truth is, diligent upkeep of your land and title matters will pay great dividends, both in the short and long term. Poor land management, on the other hand, can lead to loss of acreage, interference with operations and, ultimately, put you at a disadvantage when it’s time to sell your oil and gas assets. 

The following three factors help extract maximum value from an E&P investment:

1) the quality of the title you acquired,

2) the efficacy of your asset management program, and

3) your divestment readiness.  

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Keys to Getting the Most Value Out of Your Title Due Diligence Team

By Camille Nichols Acquisitions & Divestitures

Negotiating and executing oil and gas transactions are never simple endeavors. Transactions require careful analysis and decision-making on a range of issues to ensure you are making a deal that satisfies your objectives.

It is not always feasible to gather internal resources to support the oil and gas acquisition or divestiture process, particularly around title due diligence. Most deal terms provide for a relatively short due diligence period, thereby requiring a dedicated group of experts to examine the assets ahead of closing. Hiring an external party to get the job done will most likely be a necessity. When that occurs, it is important to know what you don’t know.

Here are some keys to getting the most value out of your title due diligence team:

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Eyes Wide Open - Five Tips for Evaluating Oil and Gas Acquisitions

By Camille Nichols Acquisitions & Divestitures

When it comes to acquiring any type of asset, it’s important to keep your eyes open across all aspects of the business—from its past performance to its future potential earnings, and everything in between. This is particularly so when evaluating oil and gas acquisitions on the heels of several declining years, during which staff was lean, bankruptcies were common and things were left undone…leading to more physical defects, as well as financial problems. Thus, the need for careful and thorough evaluations performed by qualified professionals in land and title matters.

Tips to consider

Before finalizing that offer to acquire your next O&G entity, we suggest you take the following tips into consideration.

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