Chickasha council authorizes publication and auction process for city mineral leases, removes strict 3/16 royalty limit

The Chickasha City Council approved a resolution authorizing publication of notice and a public auction under state statute (64 O.S. §1081 and §1082) for oil and gas mining leases covering city-owned real property described in Section 28 Township 7 North, Range 7 West and other described tracts.

Council discussion focused on royalty options and the statutory auction process. City staff explained the city does not independently initiate lease sales but proceeds when contacted by interested companies; the onus for title research rests with bidders and the city’s published notice disclaims title warranty. A staff speaker explained that historically offers have centered on a 3/16 royalty but said the council need not limit published notice to that figure if it prefers broader options.

After discussion a council member moved to proceed with the publication/auction but to remove the hard limitation to a 3/16 royalty and allow companies to present multiple royalty/bonus options (for example 1/8, 3/16, 1/4). The motion passed on a roll-call vote. One council member (Burris) recorded an abstention; all other members recorded yes votes.

Staff described next steps: if the council authorizes publication, the auction will be conducted (the record indicates an auction planned for the second meeting in August), and the council will later consider the offers and may return to executive session to discuss offers and reach a final decision on acceptance, rejection, or negotiation of bids.

The resolution and related public notice will be adjusted to remove the fixed 3/16 limitation and to invite competing offers; the council retains final authority to accept or reject any bid after the auction and to consider varying royalty percentages or bonus structures.