Is there a well site already set for GMB/Paloma?
Several drill site locations are currently being negotiated. I would like some clarification regarding mortgage companies that may want the royalties and lease agreement monies and how that is handled with GMB/Paloma. If a mortgage agreement requires that payments be made, the Lessor will be responsible for ensuring that the bonus money received is directed accordingly to the lender to be applied to the loan. This circumstance is not seen ordinarily with respect to oil & gas lease bonus consideration and royalties unless the lender is the Veterans’ Land Bank, which requires that 50% of bonus monies be applied to the loan. Also, in the event the exploration company requires a subordination agreement, they will make that request directly to the lender and will pay all costs associated with securing the agreement. No cost or obligation in this regard rests with the Lessor.
