Robertson County -received lease offer . I have 3.2104115 net mineral acres on 77.05 gross acres. The offer is $500 per net acre. What does that add up to? I received a check in the mail for $425. What is this bonus check?
What does the check say? If it came with the lease offer, be very suspicious as some companies actually try to buy your acreage by sending a check first. Read the fine print! If the check has a statement with it and a well name them it may be a royalty check.
The offer to lease was for 500$ per net mineral acre. (Original letter stated I had 3. something) I was thinking I would get $1,500,but I received bonus check for 425.00.
When I questioned the landsman that did the lease he responded that I should have received- $546.20 Questioned him again-this is what he sent back
“Two of the original title reports were updated after I mailed you the initial letter that stated the net mineral acres value. The title is updated each time interest owners are leased. The final net mineral interest is computed according to the title update at that time, thus changing all mineral interest, not just the interested you own.
If this is done after we send out bonus checks, we contact the Lessors with the change in ownership interest. “ Is this standard practice?
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Ask the agent “for a copy of the paragraphs from the title opinion that pertain to your acreage especially the decreased amounts as you want them for your records.” Ask him why you only received $425 instead of $546.20.
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This the email I received when I requested copy of title opinion:
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It is not uncommon for mineral interest amount on ownership report to change during the staging of Lease documents. The interest on several of the tracts you all are changed after the date of my letter. Every time a new Lease, not just yours, on those tracts, as well as all tracts we have under contract, we update the ownership reports through accessing the public records that are available to anyone. That is one of the reasons we delay paying for bonuses for 20 days… we are updating and verifying title.
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I know you feel like you should have received the initial amount I mentioned in the letter, but we pay according to the information of the current public record. For obvious liability reasons, we do not make our title documents available to anyone except our customers to whom we are responsible. You are free to search the public records as we have done to establish ownership. I hope this answers your questions.*
Does this sound right? Where do I search FREE public records? I have only found places the cost.
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This situation reinforces the fact that you should NEVER hand over a signed lease to a lessee without having the bonus money in hand. It is common for landmen to send letters making an offer with language that notes that the bonus will depend on final determination of the net mineral acres that are owned. In my view, the landman is not acting ethically in this situation as he is refusing to pay the original bonus under a claim that he was mistaken in net minerals calculation, but you do not get to know why. There is no “obvious liability reason” except that he wants to hide potential errors in his calculation. Landmen can be wrong about the title records and in calculating net acreage. You can only resolve the errors by reviewing the his title run for your minerals. I have had a situation where the landman was wrong. After we went over his title run data, he paid the bonus for my full mineral acreage and then was left trying to get a refund from another party who had been overpaid in error.
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I have in the past made it a stipulation when signing a lease to get a cashier’s check along with a title “run” for the title for at least 25 year’s back from the lease date. The lease broker’s “baulk” everytime. But, I try to deal with the actual company landman “in house” and they have agreed to me receiving a copy.
Believe me get lawyer to look it over very well. I am dealing with old wells on our place my parent’s signed the lease in the 1980’s. Its a total mess, they utilized the field were one well producing can hold several 1,000’s of acres. And now the field been abandoned for over a year and the RRC is trying to clean things up and plug these wells. One well on us had 60 to 70 barrels of oil spilled from a tank rusting out. Another rancher had 700 barrels spilled as well.
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They intended to “beat you” right from the start. If you have lease language that states that you are leasing your interest for X amount regardless of more or less then they don’t get anything back.
My wife and I was reading what we could on the leases the other day. They did show if no production was reported for 90 days straight the lease would expire. But i am not sure when the field was unitize when they did the water flood. Either way the field hasn’t produce anything in years. All the pump jacks, tank, and everything else is gone on location on our property. They injection station on one of our place was destroyed by lighting in 2013. Its nothing left there useable.
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