Haggard Land Co Section 4-12N-7W

We received a letter from Haggard Land company and Camino about leasing our rights. This is all pretty new to us.

Their offer is to lease our minerals at $1,000 per net acre at 1/5th royalty. We are believed to own 0.45 acre so our bonus payment would be $450 a long with royalties. Does this sound accurate or fair?


No recent poolings around you to compare with. I have found that early offers are usually low to final offers, so I always ask for more or stall for a while to see if I get other offers. The bonus is not the most important thing. The terms of the lease are much more important and will need to be negotiated. If you are new, I suggest reading the Mineral Help tab above and a nice post on “Inexperienced owners” for tips. INFORMATION FOR INEXPERIENCED ROYALTY OWNERS

First of all, The Mineral Rights Forum is a great help! Second, I recently received a mineral rights offer from Camino and I’m in Section 9 -12N-7W. I’ve spent all afternoon going over the info provided herein and other recommended sites also. As much as I’ve learned, I still don’t know whether to sign the agreement or not. I do know that I don’t want to extend it beyond 3 years, therefore, I will delete the last paragraph. If I hear from you SOON, maybe we can share some info that would be mutually beneficial.

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I am assuming you are talking about a lease. You probably don’t want to sign in its original form. Does is have gross royalty or does it say “net”? Does it have post production charges listed such as compression, transportation, marketing, etc. Then don’t sign. Does it limit the shut in time? (Needs it) Does it have a depth clause? (Needs it) Does it have a commencement of drilling clause?(Needs it) Does it have an option to extend? (Don’t sign) Does it have a top lease clause? (Don’t sign). Not giving legal advice. Just mentioning the things you need to watch out for.

First, I made an error, it’s in Section 4, not 9. As per your information, the Mineral Lease evidently has every item I don’t want and none of the items I do want. Not signing it. The Well Proposal letter has 6 participation Options. The agreement states that “if I elect to participate under this letter, I must also elect in writing to participate pursuant to the terms of the Force Pooling Order to issue.”

  1. Therefore, why sign it, if they can ultimately have the choice between what I choose and the Pooling Order? They obviously will take the one they want anyway, especially since I want the highest participation %.
  2. Also, the options are stated as “net revenue interest”. I assume it would be best to have “gross”?

An oil drilling company wants to place a pad on my land. They want to “lease” it. I get the tax ramification vs the two, but that’s it. Any info would be appreciated.

Thank you so much!


The mineral lease and the surface lease should be two different leases. I never sign those intent to drill letters. They are just pro forma. I would prefer a 1/5th to 1/4th royalty. (net revenue interest), the operator gets the rest.
You want a gross proceeds lease which means no post production charges. Slightly different issue, so don’t confuse the two.

If they want to lease your surface for a pad, you really need to get a good lawyer involved and make sure it is on a different lease. Entirely different concerns involved in the surface lease. That lawyer can also help you with the mineral lease.

I know a good attorney, but I feel I need one that specializes. Any suggestions? Also, I think I’d like to take any funds received from the site LAND Lease and invest in the drilling operation. Don’t know if it’s possible, but I’d like to try. Any thoughts on this? Thanks!

Working interest ownership is not for the uninformed. You need a very good oil & gas attorney, a very good oil & gas accountant, insurance policy, an LLC to put the property Into to protect the rest of your assets from any potential lawsuits and the ability to pay your share of the well and and other wells and all operating expenses for not only now but potentially for decades. Your heirs will also be on the hook. Get good professional advice before advancing along that line.


M_Barnes… Fyi… Very informative response. I’m printing this and keeping it in my “When I Die” instruction book for my child. Thank you.

The LLC is no problem. However, right now, 1) an attorney is an issue, 2) my heir is an issue and 3) after reading your response, I don’t think the acreage is large enough to justify it.

Thanks for pointing out the issues, think I’ll pass.

Just received another letter from Haggard, they are now offering compensation for us to sell. The offer is $6,000 per net mineral acre if we are unleased.

Any time I bet offers to buy, someone knows something and they think they will make a profit off of me. So I slow down and find out why and what. Considering how many reserves were listed in the increased density hearing for section 5 west of you, that is probably why you are getting offers.

Taylor- that is not a good offer, especially for unleased minerals.