We have a 10.6 mineral acres share of a larger property in Leon County, TX and received the following lease offer and would appreciate any feedback on the value of both the bonus and royalty offer below:
*Oil and Gas Lease Offer – Leon County, Texas
155.725 acres, W.J. Woodard Survey, A-1282, the J.W. Morrison Survey, A-1264 and the A. Smith Survey, A-833, Leon County, Texas.
Fredonia Land & Minerals, LLC (“Fredonia”) has been actively leasing mineral acreage for the production of oil and gas in Leon County, Texas, and Fredonia is interested in acquiring a Paid-Up Oil, Gas and Mineral Lease covering your mineral interest in the referenced property. Fredonia is offering $500.00 per net mineral acre signing bonus for a Three (3) year paid-up lease, with an option to extend for an additional Two (2) years at $500.00 per net mineral acre, and a royalty rate of 20%.*
Interesting to see Fredonia beginning to lease in Leon County. They have leased more than 10,000 acres in Freestone County during 2024 and 2025. It’s unclear at this point who they are leasing for. The terms offered are a typical first offer. The most important negotiating issue is to get a cost-free royalty so you don’t have your royalty reduced by post-production expenses.
Hi Alan - It was nice chatting with you by phone a couple of years ago. Let’s met up sometime and talk. I rarely have anyone who also has mineral interests in Leo and Freestone counties. I’ll check to make sure I still have your contact info.
I as well have mineral interest in both Freestone and Leon counties. My family leased significant acreage to Mitsui via Vanna productions three years ago. This is an active area so I would recommend due diligence regarding price and terms.
Hello.. I have a question. I have a lease that expired at the end of October, and I recently received a 2-year extension offer on behalf of Comstock for the gas well I’m in. However, someone from Comstock emailed me stating that since the well is producing and I’m receiving royalties an extension isn’t necessary so I’m a little confused on why I received the extension offer. Has anyone dealt with a similar situation or know who I should contact for clarification?
Leases have two terms, the primary term and a possible secondary term. If your operator drills a successful well in the primary term of the lease timeline and it goes into production, then the lease moves into the secondary term and that lasts as long as there is economic production under the terms of the lease. The extension offer was probably set to auto send out to everyone on a certain date and wasn’t caught in time to pull it back. The extension was just in case they needed it to get their portfolio drilled in a certain amount of time. They do not need it now. Since you are receiving royalties, you do not have to worry about contacting anyone.
First, I want to thank all of you that have replied and continue to post great information to help educate us neophytes to the mineral rights industry. I wanted to post a follow up to my original post. Before I had a chance to formally respond to the 3/2 lease offer of $500/NPA bonus and 20% royalty, Fredonia submitted a revised offer of $750/NMA bonus for the first 3-years and $400/NMA for a 2-year extension, all with the same 20% royalty. After getting feedback from my original post, reading related posts on this site, and talking with a family friend who was Texas landman I am going to be submitting a counter proposal to Fredonia with the following terms.
Lease Term: 3 years fixed (no extension option)
Bonus: $2500/NMA
Royalty: 25% net/cost free
Drilling commitment in writing
As this is our first lease offer in years, I would appreciate any feedback on whether my tactic is too aggressive or a good starting point for negotiations. Thanks in advance.
Here is the deal: if you don’t ask, you are leaving money on the table, I recently negotiated for a client $1000, 25%, 3 yr lease, with CF language, (I started asking for more, but this was the negotiated terms). We only got the deal after they leased the whole tract and then came back to my client (took over a year). If your tract is going to be the surface location the wellbore is going through your tract, you will have a leg to stand on.
My most valuable advice is to have a Lease that will hopefully outlive you. and if you enter into a lease with multiple lease addendeums, have someone with Corporate authority from the Company to sign the lease as well. Since you are most likely signing with a broker or lease flipper, I would recommend having a consent to assign clause as well. Good Luck!! Please keep us updated to your progress.
