Thank you again , I Emailed the Land-man about this and got this reply.
Would you be available in the coming weeks to have a conference call? I think we could clarify some things with you and discuss the lithium issues. As far as royalty and bonus payment this area is unproven (has not been leased in over 40 years and has No production.). Your attorney is probably thinking of leases in Southern portions of Cass County. Your interest is in the North.
Thank you all for the help.
It looks like they are trying to bootstrap a deal to sell, that is why they want the low up-front cost. Your goal is to make as much from your land as possible. You can always go to a more creative method by going to a delay rental OGL. If they will not do a standard $300 bonus, then go to a delay Rental OGL. Do something like $100/ac bonus and a delay rental of $100/ac per year. Just a thought. If they keep balking on the up front, then just let them go.
There is a lot to learn in this. This Group has been very helpful. I think the information from you all has made a huge difference thanks.
Someone in Bowie County posted today on a new thread that G2 is contacting mineral owners there. East Texas seems to be heating up re: lithium potential. Any one who has mineral rights in these counties - Bowie, Cass, Morris, Titus, Franklin, Red River, Marion, Upshur, and Camp - should be keeping a close eye on lithium developments and proposals.
RELATED ISSUE
I, too, inherited mineral rights to a small parcel (6.6x acres) in Cass Co. about 18 years ago.
A couple of times over the years, I’ve sold oil and gas leases to those mineral rights, but I don’t think the particular parcel has ever produced either. The most recent was only last year, for $250/acre and 1/5 royalty, which seemed reasonable at the time.
Just this week, I’ve received an offer to buy my oil and gas mineral rights on that land at what I’m told is a very good price, $4800/acre.
The agreement specifies that I’m selling “the interests owned by [me] as described on the Conveyance.”
The Conveyance specifies “mineral, royalty, and overriding royalty interest in and to any and all of the oil, natural gas, condensate, casinghead gas, natural gasoline, and other hydrocarbons in and under, and that may be produced, saved and/or sold from any and all of the lands more particularly described or referenced on Exhibit A.”
Exhibit A repeats that description in the Conveyance but adds “[Seller and buyer] agree that [seller] is not conveying any of its lithium or brine rights.”
Questions:
Besides oil, gas, and those gas-related hydrocarbons–and besides the excluded lithium and brine–what else might be in that land that I will still have mineral rights to?
Given that I don’t own the land itself, are there limitations on what can be extracted by means of drilling, mining, or other method?
I’m in over my head, here, and would really be grateful for any expert assistance in deciding whether to accept this purchase offer.
David
Dmbrown, that seems like a good price, but if you don’t mind sharing the survey location of the property i can study the area more accurately. Oil wells in certain areas in cass county are doing very good right now. If your minerals are leased in that area, my best estimate is that 6.5 acres “could” make you 8k to 10k annually if producing. So selling your minerals would give you definite and immediate cash, but a good well could give you that amount in 3-4 years, and of course net positive after that.
A few thoughts for you as you consider your offer. What are the qualifications of the people telling you that$4800/ac is a good price? Have you researched the activity in your area on the railroad commission website? Short of someone running the title for you, no one on this site will be able to tell you what rights you may own. An old rule of thumb for buyers is to make a purchase offer of 3 times the current bonus cost for a 3 year OGL; although, that does not truly apply today. If someone is making an unusually priced offer, then you should consider pausing for more information before you proceed. Ask the Buyer why they are offering this unusual price for the property. They will most likely offer an evasive answer, but you never know.
We’ve have and been getting paid in Cass County royalties since the thirties. My Grandfather mother’s side was a lumberman / Oil man his family has been getting royalty checks via mailbox since. My mother‘s advice to us was never sell. My advice is never sell. Lee
BearCreekBill, here’s what I have:
I own 1/8 of the mineral rights, thus the 6.6525 acres that I mentioned.
(Again, I don’t own the land, itself.)
Lee_H_DeMary,
If I don’t get this figured out, I’ll probably just hold on to the mineral rights I own. I don’t anticipate the lump-sum payment, and I can enjoy any future proceeds from the current lease, and bequeath to our sons the option to lease again or sell.
(Thank goodness for wise and frugal ancestors!)
[quote=“DRB, post:23, topic:73203”] There [/quote] You’re thinking of and using the words that they’ve injected “lump sum” they’re trying to entice you . If they’re willing to pay a lump sum they know it’s worth a lot more than what they’re gonna pay you.
Sit back and relax your royalty interest will mature and pay you. Everything takes time…
What are the qualifications of the people telling you that$4800/ac is a good price?
Two landmen with a (different) leasing company in TX.
Have you researched the activity in your area on the railroad commission website?
I have not, yet. Every time I get started, something new comes up–like lithium activity in the area!–and I’m headed down another path.
Short of someone running the title for you, no one on this site will be able to tell you what rights you may own.
There have been no deeds since 1989–my ownership portion has been determined by a TX landman, through a trace down through the historical wills–and all I’ve been able to determine is that, in 1989, my grandmother sold the land but retained 50% of the mineral rights. I’m trying to find out what minerals (besides those I mentioned) I own, based on my owning “the mineral rights.”
If someone is making an unusually priced offer, then you should consider pausing for more information before you proceed.
Yessir, that’s why I found my way here.
Ask the Buyer why they are offering this unusual price for the property.
I’ve been reluctant to do that, but I think it’s become necessary.
They will most likely offer an evasive answer, but you never know.
Oh, wait. That’s why I found my way here. 
dmbrown, there are 4 active wells and 2 permitted wells in this survey. Although the 4 active wells are not performing good right now, the surrounding area is. The 2 operators leasing in this area are Rose City Resources and Barrow Shaver Resources. If it was me, I would not sell my minerals in this area. The long term may prove to be more beneficial to you if you lease it. You should be able to lease the acreage $250-$350 per net mineral acre and get 1/5 royalty. With the small amount of minerals you own, it is quite possible that your minerals are already pulled into a lease unit without you knowing, especially if the minerals are part of undivided interest. If they are already in a unit, the operator holds any funds your minerals have made. You may want to reach out to either of them directly and see if they are part of a unit already.
Rose City spud the Stardust well (30902 on map) on August 30. These are all vertical wells which are significantly less expensive to drill and the volumes do not match horizontal wells. However, they should be long-lived and have the potential of more production in upper formations. Each well is on 160 acres spacing and so your acreage should be included in one of these wells. This is the reason for the offer.
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