Follow up on previous Trust comments

Texas Mineral Rights Reeves County, TX
1

Ok, I accessed Texasfiles, DirectCourthouse, DrillingInfo, etc., and by using Sections 126, 127, 164, Block 13, all these entities show up and list O&G&M leases, partial leases, etc. Sometimes there are 4 grantees listed and sometimes there are 1-2 extra names under the Trust grantor name.

Between 2005-2016, there are 15 separate grantees that list leases, overriding royalty, special warranty and other activity. Do they actually pay to lease the minerals or just have a hold on them while waiting to enact actual activity?

In Dec 2016, there are several O&G lease notations to grantees. From what I understand, leases are generally for 3 years. Yet, 1 month later, the trust’s mineral rights deed was sold, then sold to another, and to another company.

So, are the Dec leases cancelled between grantor and grantee or still in effect for both when new owner begins drilling/producing? Does the new owner pay the grantee lease holders, who then honor leases they made with the original grantors?

I’m trying to understand what the final financial outcome will be when the family Trust is dissolved/distributed. If there had been any “income” from all the leases for past 12 years, we’ve not been apprised. The trust stipulates that whenever there is enough money in the account to give $100 each to the 16 beneficiary interests remaining, it must be given to them. So if there had been actual leases for mineral rights, would there have been enough money during all those years to give $100 to 16 beneficiaries?

We weren’t informed that the deed was sold in Jan, only that the Trustee wanted to dissolve/distribute the trust before the 2 oldest 90+ beneficiaries passed away, and that he was looking for someone to buy the mineral rights for the 1440 acres. He wasn’t looking for a buyer, but had actually sold it months earlier. While he can say he sold it for such and such, is there a way online to find out the actual price and terms?

2

Sherry,

You are getting us confused jumping from subject to subject. Please slow down and ask your questions one at a time. It would help if you would number them so we can keep them straight.

Having said that, if I understand your questions correctly:

The different names in the Indexes we would have to see for ourselves to accurately answer your question, but it may just be the way the different people creating the Indexes did their work.

There must be adequate consideration paid for any lease, assignment or conveyance of Real Property. Oil and Gas rights are Real Property.

A Mineral Owner can grant a “Free” Lease, but that is very rarely done.

When a mineral interest is sold, it is sold subject to any existing Oil and Gas Lease(s). The lease(s) are not cancelled by the sale.

Selling the mineral interests and selling the Leases are two completely different things.

If the leases are sold, the new owner of them is obligated to honor the terms of the leases.

I would have to review whatever leases you have found to more accurately answer your question about Lease Bonus payments over the years, but given that you described 1,440 acres, I would imagine that yes, there would have been an amount or several amounts of money greater than $1,600.

If the Trustee lied to anyone on the planet about their trying to locate a buyer for the 1,440 acres when they had sold it months earlier, then they are probably guilty of at least attempted fraud. And, as I believe at least one of us has commented before in response to your earlier posts, very possibly guilty of theft.

The Trust’s Banking Records and/or the Buyer’s Records will state what the purchase price was.

If I recall correctly, several of us have suggested that you engage the services of an experienced Trust and Oil and Gas Attorney. Have you given that any thought?

Hope this helps -

Charles Emery Tooke III Certified Professional Landman Fort Worth, Texas

3

Hi Charles, I apologize for my comments and questions not being organized and causing confusion, which I realize can be taxing to anyone’s nerves in attempting to respond. I see, now, that I was mixing, or misinterpreting different terms in selling leases and/or minerals, deeds, etc.

I did contact a recommended revered contributor to the forum and at the point to gather the requested names on the Trust, there has been reluctance to proceed from 2 beneficiaries. There was a caution brought up not to involve attorneys to cause a delay in disbursements, in that everyone’s interests would be involved, not just my own concern. And as of the past weekend, there was mention that if an audit was necessary, everyone has to pay for it, and many won’t support the daunting endeavor. But they understand everything is not copacetic concerning all the past transactions and because the mineral rights deed is no longer available for dickering, we have no choice but to settle for whatever amount there is to disburse. And one memb

4

You got cut off, but I catch your drift.

As always, these matters depend upon what is at stake: How much money is involved.

Post your legal descriptions and I’ll look up what has happened on or including your lands. Wells, production, sales, etc. I will also need the names of the individuals and trust(s) involved.

I can’t determine what kind of Bonus Payments were made, or what whoever the trust sold out to paid, but I can fairly accurately determine how much money was coming into the trust from sales of oil and gas over the past 12 or more years.

If you want to send that information privately, use my Comments Board (the A Friend part).

5

Oops, here’s the rest of my sentence: And one member, more knowledgeable than I made an inference that any share would probably amount to a pittance and not even to a little hill of beans.

So, a 100 year old deed to a decent piece of Texas oil & gas & minerals prospects no longer exists, undersold, without our knowledge and without our approval.

And to think our very own ancestor, over 200 years ago, in a search for salt, was the very first person to discover oil in America, in Pennsylvania, also Kentucky, first to realize its viability, to process it with associates, and to transport, distribute it, etc. He was journaled in early newspapers to have been America’s first oil millionaire. And to have lost, gained, and lost again a fortune by investing in mines and other western state ventures, once owning thousands of Texas acres and just as much timberland in West Virginia.

Now, if his brother had followed through to buy a certain mine with the money he entrusted to him while he attended to another urgent matter, the family’s future fortunes would’ve been intact. But upon returning to take up business with the new prospect that became one of the most productive mines of its time in silver, gold, and other valuable minerals, he received back only the money he left to buy the mine for such a good, low price that would’ve outbid other disinterested bidders. The brother didn’t think it was worth his time, or that the mine was a waste of money, or some other suchlike excuse, to follow through with the purchase. If only…

Instead, everything, massive assets, had to be auctioned to honor his creditors investments after one missed or over loaned payment snowballed into many more. We must be careful with those we entrust with little or much. (It was rumored that he sold, but retained a management position and a good amount of his shares to one of his dissolved Pennsylvania co-owned oil companies, that was bought and became legendary: the notorious, monopolistic Standard Oil Company.)

6

Great story! You should write about it.