3D Geophysical Survey

General Mineral Rights Discussion
1

I currenlty have my land leased and they are wanting to do a 3D Geophysical survey on my property. I have reviewed my original oil and gas lease and the geophysical survey is excluded. They are offering me $10 an acre to cover lease and damages and if there is more damage then the paid amount they will pay for that as well…I am requesting $10 an acre plus any damages. Is this requesting too much as I do want them to find the best place to drill and make me money at the same time I know that this is going to damage my crop and affect the wild life in that area. Am I just sweating the small stuff as the big money is with the oil and gas?

2

J Guthrie:

First, I think the $10/acre is on the low side. Most seismic surveys in my area pays $25/acre. Also, I would have written signed by the company for "excessive" damages. You might want to expand on the term "excessive" such as damages to fences, etc. This will provide you with a tool in the event damages are very costly to you.

3

We were paid $250 for 10 acres in McMullen/LaSalle County to do a survey.

4

Well I think they are playing hard ball with me…they just want to pay $10 an acre prepaid damages…does not sound to good to me…heck with a crop in the ground I know they will mess up more that $10 acre. I hate to refuse the people because I know that they are looking for the best place to drill but I dont want to have to jump through hoops to get things done down the line. Seems it is getting harder for people just to do the right thing…or what I perceive as the right thing

5

j guthrie:

I agree that they are playing hardball. If you are negotiating a $10/difference per acre in this industry, that is pocket change. I would hold them to my terms at the present time. They sound like they are trying to cut all corners of the process. Again, consider the "excessive" damages clause I referred to in my initial post.
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6

I will, and thanks for the advise. Any other things I should “Make Sure this is in there” things? I plan on favored Nations clause and indeminity clause.

7

J Guthrie :

You might want to consult with an oil and gas attorney after you draft your agreement. I think by adding these clauses, you should be covered. Good luck and hope all goes well.