The city could receive at least $1.15 million in upfront payments if the mineral interests are successfully leased.
SHREVEPORT, La. — The Shreveport City Council unanimously approved a resolution Tuesday authorizing the state to seek competitive bids for an oil and gas mineral lease covering approximately 383.61 acres of city-owned mineral interests.
The council voted 7-0 to adopt Resolution 123 during its Nov. 10 meeting, advancing a proposal that could generate at least $1.15 million in upfront revenue for the city.
The resolution authorizes a request to the Louisiana State Mineral and Energy Board to seek public bids for the city’s mineral interests and provides for execution of a lease through the prescribed process.
Council members approved the measure without discussion during Tuesday’s meeting.
The proposed lease covers mineral interests in council districts F and G, primarily in the Hollywood and Mooretown areas of southwest Shreveport.
The properties include mineral interests beneath municipal streets, rights-of-way and other city-owned tracts.
Under the terms previously outlined in council documents, the lease would require a minimum cash bonus of $3,000 per acre and a royalty of at least 25%.
Based on the 383.61 acres identified in the proposal, the minimum bonus would total $1,150,830 if all the acreage is successfully leased.
The lease would have a primary term of no more than three years and would prohibit surface drilling or other operations on city property without the city’s prior written permission.
Competitive bidding required
The proposal originated with a request from Cypress Energy Partners LLC, which sought to initiate the mineral leasing process.
The company is not guaranteed to receive the lease. The State Mineral and Energy Board must conduct the public bidding process, allowing other qualified bidders to compete.
The council’s action does not establish that a lease has been awarded or that the city has collected any revenue.
Any payment ultimately received will depend on the bidding process and execution of a lease.
A bidding date, successful bidder and final lease amount have not yet been announced.