I've searched records and found two lease agreements recorded in Logan County in the last two weeks. The section, township, range and lots all match the 1/4 interest share that my mother-in-law owns, according to her deed. These must be the owners of the other parts of the interest that my mother-in-law owns. The leases do not indicate what the bonus payment is, but do indicate the royalty. I have two questions before I call the landman to negotiate a better deal for my mother in law:
1. Does the fact that we have not signed yet provide us with more leverage, since we are apparently holdouts? Do the drilling companies require our signatures before they can begin?
2. One of the two owners signed not with T.S. Dudley, but with Osage. Does my knowledge of this present another bargaining tool?
For the background, view this thread:
http://www.mineralrightsforum.com/forum/topics/logan-county-ok-oil-and-gas?commentId=4401368%3AComment%3A79086
Thanks all.
I haven't received any replies to this post, but I went ahead and spoke to the landman today. I let him know that I had educated myself so that I could be an advocate for my mother-in-law. I let him know that I was not thrilled with the terms of the lease, since they obviously favored the drilling company, but I wanted only 2 things changed - the bonus payment (from $150/acre to $300/acre) and that we wanted to delete the extension provision. He basically said that he doubted he would get either of my requests OK'd by the energy company he represents, and that they may, in fact, just choose to withdraw the offer. Can that happen and they still drill? We're talking about a net of 10 acres here - only $1500 extra dollars. I know the name and address of the gentleman who owns an interest in this same property, but signed with another company. I'm going to have to mail him, since I can't find a phone number. I got the landman to (sort of) admit that they attempted to sign this gentleman, but he obviously chose a different, and perhaps better, avenue.
Any advice (please)? Is the landman just trying to toe the line? Will they really come back and say "nevermind"? Should I contact the other company who signed with the other owner?
Thanks.
It never hurts to get a second or several offers if you can. Sometimes letting the landman know you have an offer from another party will get them to make a better offer. I think frequently landmen are not even authorized to make the best offer an operator is willing to pay. If you lease to someone else and they participate in the well the operator makes nothing off your acres. They don’t like that. Try to get at least one other offer. Good luck
David,
"I've searched records and found two lease agreements recorded in Logan County in the last two weeks."
Can you tell me how you did your search? We are located on the West Coast and need to do searches for Recorded Leases. Did you have to go to the County Clerk Office?
Your answer is most appreciated.
Coby
Coby,
I don't live in OK either, but found what I needed by googling "Logan County, OK" and then going to the county's web site and selecting the "County Clerk" link. What state/county are you researching?
r w kennedy said:
It never hurts to get a second or several offers if you can.... If you lease to someone else and they participate in the well the operator makes nothing off your acres. They don't like that.
__________
Yes, I read about this situation in the article, “Rights and Responsibilities of Mineral Cotenants,” although it pertains to Texas law:
http://recenter.tamu.edu/pdf/843.pdf
The article states, “The rule of possession permits the mineral lessee to drill anywhere on the property ... with a lease from one mineral cotenant. A mineral lease from all cotenants is not required.”
And later the article states, “Suppose George decides to lease his undivided interest to a different oil company. In other words, Harriet leases to the ABC oil company, and George leases to the XYZ oil company. If ABC enters and drills a producing well, does the XYZ company owe George a royalty from production even though XYZ did not participate in the well? In Texas, the answer is yes. XYZ must pay royalties to George just as if George had signed with the same oil company as Harriet.”
This is confusing to me. If ABC and XYZ both have leases from different cotenants of an undivided interest, what determines which company gets to drill?
And why on earth would a second company choose to pay a bonus and take a lease knowing that they might have to pay royalties while receiving nothing?
What am I misunderstanding?
David,
Beaver County, Harper County, Ellis & Logan. Most legal descriptions are in Harper County. It would be really nice if there was a way to search documents without having to go there. I appreciate your help David.
Coby
David said:
Coby,
I don't live in OK either, but found what I needed by googling "Logan County, OK" and then going to the county's web site and selecting the "County Clerk" link. What state/county are you researching?
Cody,
Start at this website: http://okcountyrecords.com/index.php Unfortunately for you, it appears that only 1 or maybe 2 of the 4 counties will provide you with the information you need. I would call the county clerk in the other counties. I paid $10 for the privilege of viewing lease agreements that were recently recorded . Well worth it.
Also use this website http://www.occpermit.com/WellBrowse/ to determine who has recently drilled or applied for a permit to drill. You can also determine the status of existing wells and discover how much oil and gas was produced.
Let me know if you have trouble navigating. I'm learning as I go, but finding the experience fun and exciting.
Dave