My family has an offer of $250 per net mineral acre for lease bonus consideration with a 22.5% royalty, 3 year primary term, option for 2 yrs after that. Lawyers want HUGE retainers just to LOOK at our offer, and we are concerned about getting fleeced, as we were in the past. Can anyone in the DeWitt County, Texas area, or anyone knowledgeable about current state of leasing in that general area, give us some perspective as to whether this is fair or too low? Thanks so much!
Request that the lease have a Pugh clause and max shut in clause of 2 years. Super important
Thanks! I have been reading up on that. Will share advice with my family.
Lease rates vary within any county, depending on location. You will get more feedback from someone knowledgeable about DeWitt County by providing a legal description. The other lease terms, such as deduction of costs, will affect the long-term return from a well. You may want to hold out for 25% royalty. Most lessors do not favor options to extend as you do not have the opportunity to renegotiate the lease terms and bonus rates may have increased substantially. So you can require the option bonus be much higher as a penalty for not drilling within the primary term. RRC website shows 86 permits since September 1, some being field transfers rather than new drills. Look at the RRC GIS-viewer to see permits and wells in area of your minerals. Take your time to research before making any decisions.
Thank you so much for the feedback. I will share this info with my family. I have been researching some on my own, but there is definitely a learning curve with all of this.