Gaines County TX

Texas Mineral Rights Gaines County, TX
1

I have the mineral rights to the north 100.24 acres of the East 187 Acres of Section 124, Block H, D&W Ry Survey, Gaines County, Texas.

Our last lease bonus was $500 per acre. They did not renew. I have an offer of $200 per acre, 1/5, 3 years. Does anyone know if this is a fair offer for this area at this time?

2

Margi,

I see several older oil wells, plugged oil wells, and dry holes in the surrounding area of your Section 124. I also see Section 123 directly next door to the south. Well #38149 was just spudded (began drilling) 8/21/2014.

http://webapps2.rrc.state.tx.us/EWA/drillingPermitDetailAction.do?methodToCall=searchByUniversalDocNo&universalDocNo=488542802&rrcActionMan=H4sIAAAAAAAAAL1Qu27DMAz8mnQUJPkBd-BgFO3cR9AMRgbFJhwBsmVQMtoC-vjSLgqkTudMIo-n4_GSkhJ0UlKBuiNq6zZaP7621DXyCCv-gSczTUELHosQTUQRP8UcdlldSWZo2Omnx0PNZbaUHVnn7Ng_Iw02hpcZ6etHVnSeSTkMGM--2_sH4xwDBRDGmca9f0ND7ZmhCuSVmyas05r6ICZDZng3bsbVJHtQZZFVKr9fugJO2NsxHGxcxFjtT6_0pr_kb9aq24UQfo8vYTI90sWR_yaijs2Wt5gFlTgNmTIucpCp4Ldk4Pr3TfL8BtJCl6hhAgAA

So there is activity in the immediate area of your minerals. At this time I don’t know if I would take the $200 bonus offer. The 1/5 and 3 years sounds OK to me. Try to negotiate upward on the $200 to possibly $350. Just my opinion.

GIS Map of your Gaines County Section 124, Block H and surrounding area:

3

Hey, Margi… didn’t know we were fellow mineral rights owners in Gaines County… we inherited rights from our parents who had the rights forever…. good to know we are neighbors.

4

Have you asked the landman why you should lease for less than half of your last bonus? What was the earlier lease’s royalty? Are you acting as your own attorney? If not, what does your attorney think? Have you tried to contact other mineral owners to see if they have leased and with what terms?

5

The landman that offered the $200 said the last landman didn’t know what he was doing. And he has since retired.

AJ said:

Have you asked the landman why you should lease for less than half of your last bonus? What was the earlier lease’s royalty? Are you acting as your own attorney? If not, what does your attorney think? Have you tried to contact other mineral owners to see if they have leased and with what terms?

6

I think it all reduces down to how much you could use the money. I confess I am not familiar with an average for Gaines County. $200 and 20% seems low. Why not phone an attorney in Seminole (or Midland, Lubbock, etc.) and run your situation past him/her? Remember, Producers’ leases are written to benefit the producers. I doubt a landman could have paid you a penny more than the lessee authorized.