Why lease with Michigan Potash & Salt Company?
Michigan Potash & Salt Company, LLC (“MPSC”) is has been operating in the Evart, Grant, Hersey, and Chippewa Township for approximately six years, and is well known in the community. MPSC’s management and execution team has been operating in Michigan since the discovery of potash in the area, since 1980 and was responsible for its initial discovery and development from 1980 until potash production ceased in 2013. MPSC is an continuation of those operations that have been safely drilled, completed, and produced since 1980.
MPSC is a minority owned, family enterprise that operates on the highest possible standard of honesty and integrity. MPSC has a dedicated team of professionals committed to efficient and responsible operations and environmental stewardship, incorporating all of the lessons learned from prior operations. A landowner is able to benefit from MPSC’s extensive operational experience while retaining the private, family owned company relationship.
What you need to know about leasing?
The Potash Lease
A potash lease is a legal contract between a mineral owner and MPSC which grants MPSC the ability to drill and produce the mineral owner’s potash and salt minerals that occur over 7,600’ below surface. In exchange for granting MPSC the right to explore for potash and salt, the mineral owner may be provided an upfront payment (bonus payment) and a royalty percentage of future production.
The Leasing Process
Generally, once a potash lease has been signed, MPSC works to confirm the legal title of the owner’s minerals. This title confirmation process usually takes about 90 days. After ownership is confirmed, MPSC may make an upfront bonus payment to the owner if found applicable. Once the bonus payment is made, MPSC’s team begins to evaluate the potential of the property. Entering into a lease does not necessarily mean a well will be drilled on a property, or that production will be established. Using horizontal drilling technology, MPSC virtually minimizes surface impacts by drilling from surface locations which are typically owned by MPSC, or which could be over two miles away.
As mentioned above, the lease provides the owner with a royalty, which is a percentage of the revenue received if production is established. If potash and salt is produced from the property, the lease term will be extended for the life of the operation, which could be 100 years or more. A royalty interest owner is not responsible for any costs associated with the operation whatsoever, and is carried through the large capital commitment associated with potash operations, in excess of hundreds of million of dollars.
What to Consider
There is only one potash producer to sign a lease with; MPSC, provided there is only one operator in the vicinity that is set to make the large investment necessary to reintroduce potash production to Michigan, and MPSC is in the final stages of implementation.
How to get started?
A team member from MPSC is available to answer all of your questions and provide you with the information you need to begin the leasing process. Building relationships with our land and mineral owners is a priority for MPSC, and we welcome any inquiry you may have. Please submit a written request through our Contact Us Page, or by filling out the form below, and you will hear back from us on short notice.