Recently I was approached with an Intent to Lease document along with a copy of what the lease agreement would be. The per acre amount and the royalty amounts seemed fair, however I did request some changes to the wording in the lease itself, such as:
- Term change from 5 yrs to 3 yrs
- Addt'l detail around how/when royalties would be paid
- Change to verbiage around deductions to royalties which included that royalties would be based - on the higher of the market value or gross proceeds with no dedcutions for post production costs.
- Increase shut-in royalties to $10/acre from $1/acre
- Remove the Lessor to complete title due diligence clause
- Added that a force majeure even could only keep the lease active for a maximum of 6 months after the expiration of the lease term.
- Added wording in the damages section to include additional items, not just the damage to crops phrase that was in there
- Added wording that if the property was to be pooled, that the entire acreage would be included
Since submitting these requests we haven't heard a word, it's been 10 days, prior to that we had continual contact.
Did I ask too much, or is this a typical time frame for response. Also, the landman mentioned that he typically doesn't see oil/gas companies change lease wording, is that true?
Two of my neighbors have already signed with no changes to the lease, the property is in Bennett CO.
Thanks in advance.