How to Manage a Successful Oil and Gas Leasing Campaign
Managing a successful oil and gas leasing campaign can be as simple or as frustrating as you make it. Landmen are often tasked with leasing multiple mineral owners and juggling all of different lessors’ special requests as far as language and terms go. Each landman or broker has their own processes, but over the course of my career running leasing projects I have noticed a couple of key traits that my most successful leasing agents possess. The best leasing agents are organized, persistent, and creative, in that order. In this blog post I am going to go into depth about each of these three key traits and give you the tools, templates, and processes to be successful!
Most land services companies or landmen don’t utilize a CRM software such as Salesforce to assist in their leasing campaigns and rely on Google Sheets and Excel spreadsheets. This is fine for smaller, shorter-term projects or mailing campaigns, but using these tools in the most efficient way possible can save you days, and your clients big bucks! For smaller projects and leasing campaigns I like to use a simple mail merge from Microsoft Excel and Microsoft Word. Most clients have a preferred template for their oil and gas offer letters, oil and gas leases, and memorandums that they ask their landmen to use, which is great! Having all of these in Word format is crucial.
I like to start my smaller leasing campaigns by inputting all of the mineral owner information into an excel template with the following columns:
Making sure that each field is properly designated as to the data type is key. You can add additional columns to track mineral owners’ information such as phone number or email address but those aren’t necessary for the mail merge. Next you will want to start populating this spreadsheet with the mineral owner information from any completed mineral ownership reports. If you haven’t done title yet and are wanting to send out mailers based on gross acres and follow behind with title that is perfectly fine, just make sure that your offer letters have language such as: “This offer is subject to a mutually agreeable lease form as well as title verification. This offer can be withdrawn by Company at any time without cause.”.
Once you have populated the rest of the above outlined spreadsheet, save the excel sheet and follow these easy steps to start your mail merge for outgoing oil and gas lease packets.
Step 1: Open the Microsoft Word template for your offer letter that the client provided you. Click the “Mailings” tab at the top of the page. Next you will click the drop-down button “Select Recipients” and choose “Use an Existing List…” from the drop-down menu.
Step 2: You will be prompted to choose your data source for the mail merge. This is where you will want to navigate to your excel spreadsheet that you created as outlined earlier in this article. Once you select the spreadsheet it will likely ask you to select the table, and you will just click “Sheet1$.”
Step 3: Click the “Edit Recipient List” button at the top of the page. You can now select who all you want to mail your offer letters to. Check the boxes next to the owners you would like to include in the mailing list or uncheck to exclude. Once satisfied with you list click “OK.”
Step 4: Now you will want to start at the top of your offer letter and begin choosing where you can plugin information from your spreadsheet. You will use the “Insert Merge Field” button to input your spreadsheet information into the offer letter. For example, highlight the current legal description of the client offer letter template provided, click “Insert Merge Field” and select “legal_description.” Where once there was the legal description from the template you now will see the following: <<legal_description>>. After this is completed the exact language from the column legal description will populate this area of your mailer.
Note: At any time during the “Insert Merge Field” process of doctoring your template, you can click the “Preview Results” button to see how the document will look after the merge. I like to do this after each addition of a new merge field. Just click the “Preview Results” button again to return to the previous view.
Step 5: Lastly, once you have populated your offer letter with all of the fields to complete the mail merge you will want to click “Finish & Merge” at the top right corner of the screen, and then choose “Edit Individual Documents…”. This will create an offer letter for each owner populated with our spreadsheet information, all combined in a single word document ready to print. I usually do a final review of the offer letters at this stage, making any final touches to capacities for business owners or trusts. Once satisfied, just print, sign, and drop them in the mail!
Best Practice Note: After each attempt to contact a mineral owner make sure to make a detailed note of the attempt that includes the time, date, and what means of communication were attempted. This way you have a record for both your client and for your own organization. Persistence is the second trait we will discuss in our second article, but persistence without organization or direction is useless!
Stay Organized
The best leasing agents are organized and focused. Having a deep understanding of what the clients’ project goals are and how they plan to develop the prospect is key. This understanding will allow you to reach commercial terms with mineral owners faster and save your client money. Haggling over terms that have no effect on a client’s project doesn’t help anyone involved. Ask your client the following questions before starting the leasing campaign to streamline the negotiations:
- Can we give lessors a cost-free royalty clause?
- What is the highest bonus per acre you are willing to pay?
- What is the highest royalty you are willing to pay?
- What pooling language will you need?
- Do we need surface use in our leases? If so, I would recommend using University Lands Rates and Damages Schedule if in Texas.
- Can we give lessors depths severance and pugh language?
- What is the minimum term we are willing to provide in our lease?
The above seven questions are often the most common provisions requested by mineral owners during a leasing campaign. Having pre-approved language from the client for each of the above questions will help streamline the leasing project.
Keep a clean desk, and save everything digitally. Landmen often write down notes on paper during calls and forget to input those leasing notes into their lease contact spreadsheets which can cause havoc on negotiations if landmen are moved from one project to the next.
Having weekly project meetings to discuss lease negotiations is often extremely helpful. Many leasing campaigns are split up between multiple landmen reaching out to various owners. The problem with this is many owners are often related to one another. Constant communication between landmen on any given project will help people get more results and prevent mineral owners from getting frustrated about getting a different offer/terms than a family member.
Persistence Wears Down Resistance
Being a successful leasing agent is teachable and repeatable. The most successful leasing agents are persistent in reaching out to mineral owners. Some mineral owners are difficult to find, or just have no interest in spending time leasing their interest. Consistently reaching out to these owners and identifying where their pain points or concerns are will eventually lead to a solution and a commercial lease. It could take 10 or more calls or letters just to get a verbal agreement to lease. Just stay on it and remember that “persistence wears down resistance!”
Creativity Works When All Else Fails
Some people believe the definition of insanity is repeating the same thing over and over again and expecting a different result. One of my favorite parts about leasing or purchasing minerals is being creative with difficult owners. In 2015 we decided to bring teddy bears and Christmas gifts to mineral owners unwilling to lease. A simple act of good will goes a long way and often yields to a more amicable negotiation. I have heard of landmen bringing pies, flowers, cakes, mailing edible arrangements, sending chocolates and handwritten notes, and many other creative ways to get a response from mineral owners who are cold towards the oil and gas leasing project. These strategies don’t work every time, but it’s worth the $20 spent to try and get past the cold shoulder. Have fun with the leasing process and don’t be afraid to get creative when all else fails!
Peak Land Services has taken over 2500 oil and gas leases for various clients since 2014. We pride ourselves on being a results-oriented land services company. We treat our clients’ money as if it were our own and use efficient management techniques to ensure that our clients’ money is being well spent. We know how to effectively launch and manage a large-scale leasing campaign and have the title team to back it up!
Peak Land Services, founded by Mitchell Eberenz and Cole Frederick, was built with the intention of creating a superior land services company. Peak Land Services has completed lease plays in Texas, New Mexico, and Oklahoma for our clients with immense success. Give us a call and let us help you grow your leasehold position today!
Whether it’s complex mineral title, leasing, or finding open acreage, Peak knows how to maximize our human capital through the use of technology and get results!
Peak Land Services is an energy land services company based in Midland, Texas.
Phone: 432-203-0709