Seller and Buyer Questions
(Seller Questions) (Buyer Questions)

Seller Questions

Who do I contact to sell properties?
Five Client Relations Managers have primary responsibility for working closely with each Seller within their assigned areas. Client Relations Managers are based in Calgary, Dallas, Denver, Oklahoma City and Houston. Simply E-mail or call the client relations manager nearest your office location to sell properties.

How long does it take from start to finish?
The length of time for a negotiated sale, handled by our Transaction Services Department, will be determined in consultation with the client. The auction sale process can be accomplished in as little as 45 days from property commitment to financial settlement.

What is the Auction Sale Brochure?
The Sale Brochure is the glossy publication sent 30 days in advance of each auction to over 16,000 interested and qualified parties in the U.S. and over 2,000 in Canada. It features basic information on each property and instructions on how to order data that can be used in evaluating the properties that interest you.

What is the Auction Catalog?
The Catalog is the publication available at the auction site that specifies the order in which the properties will be sold. It contains information on recording fees, lotting changes and property information that became available after the Sale Brochure was published.

What kinds of properties sell best at auction?
Geographically scattered properties with well documented production information that are supported by clearly detailed financial information sell well at auction. Properties ranging in value from $100 to $20,000,000 sell equally well at auction.

What types of properties sell best through negotiated sales?
The negotiated sale process is generally employed when a large percentage of a property's value is in upside, when the Seller is severely constrained by contractual obligations and/or when properties are geographically consolidated.

What are the technical resources of The Clearinghouse?
The Clearinghouse's Technical Resources Department is composed of engineers, engineering techs, geologists and landmen and land assistants that work with clients in the preparation, evaluation, presentation and closing of properties. Our job is to identify property attributes and present the properties to potential buyers in an efficient manner.

What are your transaction services?
The engineers and geologists acting as transaction managers serve Clearinghouse clients in the gathering, data preparation, presentation and closing of privately negotiated transactions. These transactions are typically for field level properties or prospects with a high percentage of their value in upside.

What do we have to do to get properties ready to sell?
1. Obtain a complete electronic list of all of your company's properties. Your most recent reserve report is a good starting point. Update the information as much as possible to allow for recent discoveries, additional development wells, successful workovers, changes in well status, pluggings and abandonments, recent acquisitions or divestitures, interest changes and any other quantifiable item that may affect value.

2. Decide on the result you want to achieve. Is it to sell everything, maximize value or the always popular "both" answer?

3. Schedule an introductory meeting with your Clearinghouse Client Relations Manager. Share your aspirations and ask for suggestions on how to achieve them. Seek input on improving your path to success. We will follow up with another meeting once we have had time to review your information and formulate a recommendation.

What will my property bring?
Property characteristics must be evaluated on an individual basis before an opinion regarding value is possible; however, royalties tend to consistently sell for higher multiples of cash flow than do working interests.

When is the first deadline?
For Minimum Bid properties the first deadline is 68 days before the sale. The first deadline for absolute properties is 60 days before the Sale. Please contact a Client Relations Manager or our Marketing Department for a complete auction timeline.

What is needed by first deadline?
A commitment to the sale process in the form of a signed Agreement for Sale of Oil and Gas Properties and the upper one-third of the Property Data Sheet (PDS) for each well. Minimum Bid and Notable Properties will require additional information including lease operating and historical production.

What is an "absolute" property?
An "absolute" property is a property that will be sold to the highest bidder as determined by the auctioneer with the drop of the gavel.

What is a Minimum Bid property?
A Minimum Bid property is a property where the highest bidder must attain or exceed a value that has been previously agreed upon by Seller representatives and Clearinghouse representatives. The minimum acceptable bid amount is agreed to in writing before the auction and is not revealed prior to the auction. The Clearinghouse audits all Minimum Bid properties for reasonableness and/or reserves prior to listing the property.

What is a Notable property?
Notable properties are higher value properties that are showcased in the layout section of the brochure. All minimum bid properties are also notable properties.

What is your commission?
Commissions on auction properties and the value received in exchange for The Clearinghouse's services are covered in the Agreement for Sale of Oil and Gas Properties. Please ask your Client Relations Manager for a copy.

What is the top 1/3rd of the Property Data Sheet (PDS)?
The top 1/3rd of the Property Data Sheet ("PDS") is the basic well information printed in the auction property listings of the Sale Brochure. The basic well information includes well name, API number, operator name, location, interest, gross daily production and lease type.

How are you sure the buyer will pay?
our reputation as the premier provider of auction divestiture services for oil and gas properties is based on our past successes. The Clearinghouse only approves selected parties who are knowledgeable, sophisticated and actively engaged in oil & gas business. Our approved buyers must be aware of the risks and liabilities inherent in the ownership of oil and gas properties. Buyers protect their ability to participate in our auctions by honoring all of their obligations.

Who prepares the assignments?
Conveyancing documents (assignments, deeds, etc.) are prepared by the Seller of the property. The Clearinghouse will advise you of the specific requirements for the counties or regulatory agencies that pertain to your properties.

When do I receive settlement for properties sold?
Twenty banking days after the Sale Day, although The Clearinghouse has succeeded for many years in making payment much earlier.

Who is the buyer of my property?
In the auction process, a pre-qualified high bidder. Under the Negotiated Sale process, the buyer will be the bidder that meets or exceeds the terms and conditions in the Offering Memorandum.

When is the best time to sell?
Two conditions must be met to determine the "best time to sell." First, the seller must be comfortable with their decision to sell. Selling under duress, regardless of the circumstances or method employed, never results in a good feeling. Second, you must carefully choose an excellent marketing company and follow the advice you are buying. If you feel good about selling and hire the best coach, you will experience a successful divestiture.

What due diligence services do you provide?
Most Sellers have long standing relationships with due diligence providers. The Clearinghouse respects and admires relationships founded on trust and competence. The Clearinghouse's due diligence role is one of coaching you and the due diligence providers toward a successful finish. The best way to do this is to schedule a brief training session (this is another one of our basic services) prior to beginning your internal due diligence. Clearinghouse professionals are masters at saving our clients time and money, while maximizing value. It is what we do every day and we are very good at it.

Where will my property be sold?
The Clearinghouse's Sales and Data Rooms are generally held in Calgary and in Houston, Texas; however, we have hosted data rooms in Denver, Midland and Oklahoma City on numerous occasions.

Buyer Questions
(Seller Questions) (Buyer Questions) (top)


How do I get on your mailing lists?
Upon request we will email or fax you a sale brochure request form for you to complete and return to us. Once you are approved, you will receive our Sale Brochures and notices of Negotiated Offerings that fit your Acquisition Profile.

How can I view property information and conduct due diligence before the auction?

You can review information on the properties by:

• visiting our Website at www.ogclearinghouse.com.  Select "Next Auction" to review the Online Data Room Explorer. Next, click on Data Room Explorer. Enter your Client Number and password. Select the auction you are interested in and review information on the properties. In many cases, you can download economic evaluation data.
• ordering paper copies of data packages. Complete and fax the order form on the back of our sale brochure.
• visting our Houston office Data Rooms. Approximately 30 days prior to the auction our Data Rooms are open. Seller well files on all Notable properties are available for review.
• attending our Pre-Sale Conference at the Sale site. Seller representatives are available for questions and all seller files are available for review.

When can I review the Purchase and Sale Agreement (PSA)?
PSAs are seldom used for auction properties, however, assignments are typically available for review one week prior to the auction. In the Negotiated Sale process, the PSA is available as prescribed in the terms of the Offering Memorandum for each property.

What type of modem will I need to be able to participate in the Hybrid live/Internet and Exclusively Online Auctions?

The minimum speed requirement for a modem connection is 56kbps. If you have questions about system compatibility for the auction, please contact us by calling the support line at 281.873.4600, or by sending an email request to support@ogclearinghouse.com.

What type of computer software will I need to be able to participate in the Hybrid live/Internet and Exclusively Online Auctions?

In order to participate in the auctions, the required Internet browser is Microsoft Internet Explorer ver 4.0 or higher or Netscape ver 4.5 or higher. AOL 3.0 and 4.0 are not compatible and will not work. If you have questions about system compatibility for the auction, please contact us by calling the support line at 832-601-7601, or by sending an email request to support@ogclearinghouse.com.

Can I bid on properties, using more than one Client Number?

Yes. If you have registered under more than one Client Number, you may open several Bid Windows or Watch Windows for either the Hybrid live/Internet auction or the Exclusively Online auction. If you have questions on bidding with more than one Client Number, please contact us by calling the support line at 281.873.4600, or by sending an email request to support@ogclearinghouse.com.

What should I do if I have problems logging on or placing a bid?

Call the Clearinghouse at 281-873-4600.

Can I bid by phone?
We do not take phone bids, however, we offer simultaneous live floor/Internet bidding or the Clearinghouse can provide a list of contract bidders.

How many lots an hour do you sell?
About 40 lots per hour once the required announcements and introductions are completed. There are no scheduled breaks during the auction. The Clearinghouse serves a complimentary buffet luncheon on Sale Day, however, the auction does not stop.

How do I use my bidder card?
1. As a receipt to review data on either Pre-Sale or Sale Day
2. To identify yourself to the ringman that relays bid amounts to the lead auctioneer.
3. To identify yourself as the high bidder or backup bidder at the conclusion of bidding on a particular lot.

NOTE: Please safeguard your bidder card at all times.

What do I do if I am high bidder on a lot that didn't reach the minimum?
Contact a Clearinghouse representative if one does not contact you. He or she will assist you further.

What are the backup bidder's obligations?
The backup bidder may discover an opportunity, but has no obligation.

When do I close and take title?
Closing for each property acquired at an auction occurs on Sale Day. As a high bidder, you are expected to pay for your properties and sign all the conveyance documents at the auction. Once this is done, you can pick up the Seller's files, unless the property is subject to a preferential right to purchase or consent to assign is required. The effective date of title transfer will be specified in the conveyance. The Clearinghouse records the conveyancing documents, then sends the original to the buyer and a copy containing recording information to the seller.

How do I pay for the properties on which I submit the highest bid?

If you are a successful internet bidder, the Clearinghouse will fax or mail an invoice to you within 24 hours after the auction. You will receive a summary invoice for the total amount of all purchases, plus any applicable taxes and/or recording/filing fees, and a detailed invoice which breaks out the costs associated with each lot purchased. Payment for the prperty is due upon receipt. You may pay with a company check or by wire transfer. If you are paying by company check, you must provide a bank guarantee letter prior to the auction. If you are paying by wire tranfer, instructions will be sent to you .

If you are a successful floor bidder, you will be required to pay the day of the sale. Buyers may pay either by a cashiers check, wire transfer, or company check. If you are paying by company check, you must provide a bank guarantee letter prior to the auction. If you are paying by wire transfer, instructions will be given to you at checkout.

When will the Seller send me the files?
Unless the property is subject to a preferential right to purchase or a consent to assign, you may pick up the files at the Seller's table immediately after payment and execution of the conveyance documents. If you need assistance with shipping the files, please contact The Clearinghouse's shipping station at the Sale site.

How do I find a particular seller at the sale site?
Sellers are assigned space at the Sale site and are arranged in a horseshoe shape around the room. Sellers will have a sign identifying their table.

Can I find out how much a lot sold for? Is the information available for post sale studies?
On the day after a Sale, you may call The Clearinghouse to inquire about the price paid for a particular lot. The Clearinghouse does not publish the Sale results, but you can record the winning bids as they are posted on the Internet and the electronic signs during the Hybrid auction.

How do I receive the well, land and other associated files and records for the properties that I purchase?

The Clearinghouse and/or the Seller will ship the files to you C.O.D. immediately after payment in full is received and cleared.