How do i find out more info?

Oil and Gas Leasing Help
1

I received a letter from an investment company a week ago wanting me to sell for 8300. i received another letter a few days ago of the mineral deed & letter of agreement. i am not in dire need of immediate cash. My sister and i inherited this from my Mom in Washita County, OK - Section 25, Township 11 North, Range 18 West. Once a year i receive a check from SMEnergy ranging from 5.00 to 13.00 - are they the leaser?

Any info given will be greatly appreciated - as i can tell he desperatly wants me to sign

2

Babette, SM Energy would most likely be the operator but not necessarily the lessee. Frequently the offer to buy producing minerals is a function of 3 to 5 years worth of royalties. Considering an offer of $8,300, my first conclusion is that someone expects there to be a large increase of production, either extensive reworking of the old wells or the drilling of a new well or wells. I think you might want to still be the owner when that happens because while people do lose money buying minerals, that is not their intent and usually the buyer knows something that you don't.

There could be alot of things at work here, the buyer may have found that not all of your minerals were leased and there could be a large amount of money waiting for you. So many different ways this could play out.

You might tell him that he has alerted you now and that if he tells you, you will pay him for his landman work, otherwise you will hire someone to duplicate what he has done and they will get paid and he will get nothing, his choice.

3

Babette, I would just wait to be contacted by the actual operator. This person knows something you don't, that you will probably be notified of in due course. It can't hurt to do a little investigating here, join the Washita county group here if you have not yet done so. I don't have my finger on the pulse of Oklahoma and was responding to your general question, but there are very knowledgeable people here on the Oklahoma forums that may be able to help you. Join the county forum, have patience and good luck.

Ps. Just tell the person tomorrow you are still looking into it, if they raise their offer, I'd assume it was because there was something to find and they didn't want me to look.

4

Wait a minute, you get a yearly check for $5.00-$13.00 and you are wondering whether or not to sell for $8,300? What's there to ponder? Or are these on two separate tracts, are the producing minerals separate from the ones for which you have been proffered a mineral deed and letter of agreement?

5

Babette,

Any time a land man is desperate for you to sign ANYTHING, they are desperate to get your money. Stop and smell the roses. It looks like you may have something big on the horizon. Tell the landman you and your sister will discuss this and you'll get back to him. Do not give him a way to contact your sister. If you do he may start bugging her. There is no rush on anything except the landman wanting you to sign. Have a great day and good luck with your venture.

Yours,

Wes Luke

6

Babette -

You should consult an experienced Oil and Gas Attorney for anything of this nature. The potential future value of any mineral rights should be closely reviewed before making any decisions, especially any decisions about selling them.

There is a woman in New York City that accepted my advice and did not sell her mineral interests in what you might think of as a rinky-dink 50 acre tract down in the Eagle Ford Shale play south of San Antonio, Texas.

Instead of accepting a quick deal, for an amount of money that she probably would have gone through by now, she is now included in 3 producing wells with a total of 8 wells possible (and probable), and that is just from the Eagle Ford Shale formation (there are others known to be productive in the area).

I conservatively estimate that her small interests in the 3 currently producing Eagle Ford wells will be making her $50,000 a month in royalty income by the end of this year, with the additional wells still to be developed.

That's A MONTH, Babette.

The people making offers to buy you out know something that you do not - the amount of money they have offered you reflects that.

If you will post your legal description(s), I'll see what I can find out about what is happening in your area.

In the meantime, hang tight and don't sign or agree to anything. I have a feeling you are in for some very wonderful surprises in the coming months - perhaps a lifetime of them.

It is a shame your sister acted so hastily. If you have other family members - cousins, etc - with interests in the same or other area lands, you may want to forwarn them about taking the quick money. At least until I have a chance to take a look.

If they are still tempted, or need the money for some reason, then ask them for the first right of refusal to buy them at the best offer they received. Keep as many of the interests in the family, so to speak.

Hope this helps -

Charles

Charles Emery Tooke III

Certified Professional Landman

Fort Worth, Texas

7

Babette,

what decimal interest is on your royalty revenue statement?

8

I'm new to this - and have to do some research.

Or are these on two separate tracts, are the producing minerals separate from the ones for which you have been proffered a mineral deed and letter of agreement?

9

Babette -

The legal description is a written description of the land. If it is in a subdivision in a city, it will have a Lot Number or maybe a Lot and Block Number, which refer to a particular piece of land drawn out on a map of the subdivision.

If it land out in the country, it will be a metes and bounds description describing the outside boundary lines of the property.

You can find whatever description you have in the papers where you acquired your interest. Was it by Deed or by inheritance?

Accept my offer of friendship of The Forum and we can trade personal contact info.

Charles