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Tarrant County Texas - Offer Seems Urgent
Over the last two months, I have received an offer for a mineral lease on my property. A gas company has setup a pad to drill on October 1st of this year. (Less than a month away.)
After not responding to the letters, a young man has called the house wanted to speak with me and even offered to take me out to lunch so I could "get those papers signed".
He has mentioned that my property is the last on the site to not sign and he mentioned that it was starting to be urgent that I get this taken care of.
So far, he as offered a lease for 20%, along with $210.00 bonus -OR- all mineral rights for $450.00.
Although I don't mind the offer, it seems a little low and not worth my time.
I have a couple of questions about all of this:
1. Is all of this rush to sign an act on the other guy's part, or is he really in a bind?
2. Can they drill on the site without my authorization?
3. Is it possible that if I keep playing it cool I could lose my opportunity to make money off my minerals?
Any help you can offer would be great.
After not responding to the letters, a young man has called the house wanted to speak with me and even offered to take me out to lunch so I could "get those papers signed".
He has mentioned that my property is the last on the site to not sign and he mentioned that it was starting to be urgent that I get this taken care of.
So far, he as offered a lease for 20%, along with $210.00 bonus -OR- all mineral rights for $450.00.
Although I don't mind the offer, it seems a little low and not worth my time.
I have a couple of questions about all of this:
1. Is all of this rush to sign an act on the other guy's part, or is he really in a bind?
2. Can they drill on the site without my authorization?
3. Is it possible that if I keep playing it cool I could lose my opportunity to make money off my minerals?
Any help you can offer would be great.
Replies to This Discussion
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Permalink Reply by Charles Emery Tooke III on -
Hi Bob -
I am a Certified Professional Landman with more than 30 years of experience in the field.
Selling your minerals would be a huge mistake. Especially for only $450.00, even if that was a per acre offer.
Leasing your minerals for $210.00 would be almost as bad, unless the company is a smaller regional company and only interested in the shallow rights.
Where is your land in Tarrant County? Do you know the Survey and legal description or can you give me the address?
If so, I can take a look at what is going on in the area and get back to you.
The quick answers to your questions are:
1. Field Landmen will always be under the gun to get things done. Nature of the beast.
2. Certain regulations apply, as well as the terms of the lease. But generally speaking, they can drill on any land that they have under lease. It would be highly unusual for them to stand a rig up on a tract of land that they have only partially under lease, however, which might be an indication as to why the Landman contacting you appears to be in such a hurry.
3. Very possible. There are a few regulations they have to abide by, but generally speaking they can shape their unit in such a way as to leave out any unleased lands or even those of landowners they consider uncooperative. They can leave you high and dry, surrounded by producing units but left out of all of them and with too little acreage to form a unit of your own.
I live in Fort Worth. If you will send me a copy of your legal description and how to get in touch with you and I'll take a look at what's happening in your area and get back to you.
Charles E Tooke III, CPL
fieldlandservices@gmail.com
713-408-2850 Cell
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Permalink Reply by Lisa on
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Charles didn't address the issue, but couldn't Bob be forced pooled if he doesn't accept a reasonable offer? Isn't a reasonable offer the same terms that were offered to the neighbors? I'm guessing forced pooling is truely a last resort, so they would rather get you to sign if at all possible. Have you talked to any of the surrounding neighbors to find out what terms they signed under?
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Permalink Reply by Charles Emery Tooke III on
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Lisa is entirely correct. I didn't addressed that issue in my earlier response and should have. I have attached information regarding what is known as the the Finley Decision from a couple of years ago. That decision was the first time in Texas history that "forced pooling" as we think of it was allowed to occur. It has been a while since I have researched the subject (I would imagine you could find any number of blogs or legal papers on it). But if my memory serves me, before Finley the Mineral Interest Pooling Act was only used with regard to small tracts of land known as "strips and gores." Same basic concept, except Finley was the first time a substantially sized tract of land in the interior of a proposed unit was allowed to be force pooled. It was a real game changer for the industry. Bob can also choose to participate in the well as a Non-Operating Working Interest Partner (they'll send him a bill for his share of the drilling, completion and operating costs). Or he can choose to participate in the well(s), but not put up his share of the drilling, completion and operating costs and, under Texas law, they will start sending him checks for his share of the production once 200% of "payout" on the well(s) has/have been reached. But before we get in to too much detail about any of that, I'd like to see what information we can provide Bob on his situation - who is drilling what, for example. I'll need a legal description to do that.
Enjoy your weekend - I'm headed out. Hope the attachments work - I'm new to all this.
Charles - Attachments:
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09-0252373 PFD Finley.pdf, 2.4 MB -
09-0252373 Amended PFD - Finley.pdf, 2.3 MB
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09-0252373 Final Order - Finley .pdf, 883 KB
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Permalink Reply by Jason Dvorin on
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Bob,
I am familiar with Tarrant Co. and most of the operators, and their respective operations and land departments. If you have not resolved the issue... feel free to contact me direct at 877.386.7461 and ask for me. I wouldn't mind giving you an assessment of the situation.
Jason.
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Permalink Reply by Bob Smithtims on
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I think the best way to go is let the highest bid win.
I have had some other offers and they have been more compelling than the first.
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