Coal lease in southern Illinois

Appreciate any advice that can be offered…

Recently came into an inheritance of mineral rights. Found this out by receiving an offer to lease these rights to American Coal Company. Needless to say, I’ve been madly researching everything I can regarding coal leases.

While there is some information online regarding the different clauses of a lease, there is very little information regarding the current market value or rates that are being offered to mineral rights holders (at least with regards to coal…). I have been offered $50/acre per year lease and a 3.5% royalty on gross less some specific fees. Seems a bit low compared to the very limited and dated information I could find.

I would appreciate any feedback on this offer. I would also appreciate if anyone could point me to any resource that I can utilize to continue my research. I do plan on getting a local lawyer as well (I’ve got one lined up; but I’ll gladly accept any recommendations as well if someone has personal experience).

Thanks for your time, and attention!!

John,

The rental or advanced royalty depends on the location and mining situation nearby as well as your expectations. the percent royalty is on the low end of range for an established mine but may be appropriate if the lessee has near term, high capital costs to endure to meet long term contracts.

If you have large acreage, your local lawyer should consult with an experienced mineral lawyer. It is a different ball game.