Mineral advice needed

General Mineral Rights Discussion
1

I need to give a little back ground first,

I purchased my current home and land 10 yrs ago. when we were looking at the property I had inquired about the mineral rights, and was told that they had long been separated from the land.

last fall i received a call from the title company that did the closing, they told me that the previous owner had contacted them and said that he was supposed to have retained the mineral rights, and that he had been receiving a royalty check since 1999. and that he had stop receiving them when apparently the operator discovered that no reservation of rights had been maid by him when selling the property.

I really question if this is true or not? about two yrs ago encana drilled a well just off my property but in my section.

I asked the title company for a contact number, and that i would like to call and talk with them, i also had some questions that i would like to ask them about the property. they said they could not give out any numbers, but would give my number to them and tell them to call me. about 2 months went by with no word, then i received a letter from an attorney demanding that i sighn a deed giving the previous owner the mineral rights. also threatening me, that i was conspiring with the title company to commit fraud. i thought well that's a real good way to try and get my cooperation. so i gave no reply. few more month went by and i got a message from this lady. saying she was a landman and was a friend of the previous owner and would like to speak with me about getting the mineral rights straiten out. i did not reply to her ether.

After all this I started to research a bit, i have had no prior dealings with minerals before. After doing a lot of title research and learning a bit more, i do think that i retained the mineral rights to the property. I can not find any leases that the previous owner had. but do realize that the operator does not always file the leases to public record. its been a little over a yr now since this has all started and i have not been contacted by the operator ether.

What should i do now? I am still trying to get a handle on how all this works. there are several wells in my section that are producing, am i right in thinking, that if i do have mineral rights I should be receiving royalty's for any wells in my section? Even if the wells are not physical on my land? who do i contact? does the operator have to obtain leases for all parcels/acres located within a section before drilling in that section? and how often do they have to update the ownership records for there leases?

my property is in Mesa County CO, T10 South, Range 95west, sec 18

any advice what to do next? would be greatly appreciated.

2

Hello,

Wow it is intersting the complexities that goes along with being the owner of shares with other grandchildren. I too am learning about this. i have seen a few places for contacting the Tile Company the governement of Canada laws and history info on possible drilling on the acres that belong to us. Questions for me come up like who has drilled under my land and do I have any rights Etc. THen there is someone like yourself that has a home on land that is rich in this mineral that is owned by someone else. Here I am at age 55 and just found out about this. The owner may not know anything about this at all. But if there has not been a lease in place for the builder to hve gotten approval, It is my thoughts that you would not have rights to what you don't own.

It would be a good idea to have a conversation directly with the person about the Minerals. Its a way for you to ask the questions that you need answered. You are in need o know what you have rights too or not and it cant be taken from you if you never had the rights to it in the first place. The royalty checks go to the owner for the minerals they own. They dont want your home, and you have rights to what you paid for. Best of Luck

3

My "take" on this is that the previous owners did NOT reserve the mineral rights. Check your Deed to confirm, and confirm that Deed was recorded. Whatever you need to know can be answered at the courthouse. Personally, I would not contact the previous owners. The operator is the only entity I would contact to let them know you are the mineral owner (have legal description handy) and what "action" is happening around your land and can/is your land included, etc., etc.

Good luck.

Pat

4

You need a real good lawyer that will ensure your rights are protected. It looks like someone failed to protect their interest in the mineral estate, and now they are trying to recoup that which inadvertently they lost.

Sign nothing until the title is clarified.

5

Mr. Barbee:

Don't sign anything yet. Sounds like there is a high likelihood you may own an interest in those wells and may be owed back royalties. I am a Colorado licensed oil and gas attorney, I can give you some general answers to most of the questions you posted. I have dealt with this issue before, both for clients and with minerals I own personally. Give me a call directly (720) 432-7299.

6

Looked at another way, these people who are making threatening contacts now, informed Mr. Barbee that the minerals had been severed and Mr. Barbee thought he was buying all of whatever remained of the bundle of sticks, which seem to include the mineral rights. Mr Barbee obviously wasn't trying to sharp them, they did it to themselves.

J S Morgan said:

Well, I will give you the other side of spectrum.

From your first sentence when you purchased the land you were aware you were buying surface only.

"I purchased my current home and land 10 yrs ago. when we were looking at the property I had inquired about the mineral rights, and was told that they had long been separated from the land."

You paid for surface only. The right thing to do is give the previous owner a chance to get his property into his hands.

Just a thought, good luck either way

7

I myself might be inclined to help them out, if they explained the mistake, and told me they would incur all expenses in straightening it out but demands and threats from lawyers might make that go away.

J S Morgan said:

It's true you can spin it which ever way you like.

Doesn't make it right. But you know that ;-)

8

Going to have to side with Mr. Barbed on this… He was told minerals had been separated long ago… He bought the property as is… If landowner made the mistake well is a lesson learned… He pid his price up front and sounds like to me now at least has a portion of minerals…

Lesson learned hard way for someone…

9

Why waste your time with all the above. Simple ... go to the courthouse and check your Deed. You do not need a lawyer for this. You do not need to speak to the previous owners. If your Deed says you own the mineral rights ... you own the mineral rights.

Good luck,

Pat

10

First of all, I want to thank everyone for their responses.

And to respond to J S Morgan. you can definitely spin this ether way. I would also say, there's is a lesson here.

Had the previous owner been truthful in the sale of the property and presented all issues ect. on the disclosure statement that he was legally obligated to do, include-ding disclosure about the minerals and his desire to keep them, if that was in fact his intent. Then he wouldn't have put himself into this position. Unfortunately this was not the only issue that i was flat lied to about, prior to the purchase. with some of those issues costing a great deal, so I am really not very sympathetic at this point. With that being said. i do intend to pursue any and all of my rights.


r w kennedy said:

I myself might be inclined to help them out, if they explained the mistake, and told me they would incur all expenses in straightening it out but demands and threats from lawyers might make that go away.

J S Morgan said:

It's true you can spin it which ever way you like.

Doesn't make it right. But you know that ;-)

11

Ms. Malone,

I have done what you suggested, and have gone to the courthouse and searched ownership back to the early 1900's it is my understanding, (and someone please correct me if i'm wrong) that the property deed will not always show the mineral rights. if the property has changed hands and no reservation of mineral rights are made then the rights transfer to the new owner along with the surface rights. during my search i can see where the mineral rights were transferred with the sale of the land, back several owners. that owner lost the property to foreclosure. I believe they also lost the mineral rights along with the property at that point. And when the bank resold the property they did not make any reservation either. So i believe the minerals would have been included and transferred in that sale as well. No other reservations have been made during any ownership transfer from that point, up to the point that i purchased the land. Its my understanding that unless you reserve the minerals when selling a property they stay with the property. and if you are to separate the minerals from the land you have to create a separate deed for the minerals, by doing this you now have a deed for the surface and a deed for the minerals. If you were to do this as the owner of the surface and the minerals, you would be taxed separately for the property and for the minerals. if you leave them attached you are only are taxed once for the property. Again, anyone please correct me if i am wrong.

At this point i am just trying to educate myself as much as possible before contacting the operator.



Ms. Pat Malone said:

Why waste your time with all the above. Simple ... go to the courthouse and check your Deed. You do not need a lawyer for this. You do not need to speak to the previous owners. If your Deed says you own the mineral rights ... you own the mineral rights.

Good luck,

Pat

12

Can anyone explain to me who the operator is obligated to compensate when drilling a well? I am trying to understand who they must obtain a lease from. for example if they drill in a certain section of land that has been split up into multiple parcels, do they need to obtain leases from all owners in that section? and compensate all mineral owners in that section? and at what point do they draw the line? what if they drill a directional well and the well pad is located in say.., section 20 but the bottom hole crosses over into section 21 would they need leases from all owners in sections 20&21?

13

Mr. Barbee, you bought the land encumbered with a lease. The operator pays the mineral owner according to the terms of the lease. If you now own the mineral rights so they should pay you. No, they would not need leases from nor necessarily pay all owners in sections 20 and 21. In Texas the unit can be irregularly shaped and need not be a full section. I am sure there is a blog here that explains pooling in Texas better than I ever could and I would search that out.

14

You might want to read this:

http://www.mineralrightsforum.com/profiles/blogs/the-title-company-blew-the-agreement-and-conveyed-my-minerals

15

Thank you for the link, very good read



Buddy Cotten said:

You might want to read this:

http://www.mineralrightsforum.com/profiles/blogs/the-title-company-...

Best,

Buddy Cotten

Mineral Manager

16

What comes to my mind when following this forum is the time when I had to deal with my property owner's new next door neighbor. (I was managing residential properties and had a POA for this particular PO because he travelled extensively.)

One day, his new neighbor accused my PO's garden hedge as encroaching onto his property and said it had to be removed. Sure, I told him, but could he first show me proof of the encroachment. Shortly afterwards his title company and attorney started their contact "attack." Ok, I said to everyone who was, by that time, breathing down my neck. Just, please, show me some proof! The attorney furnished a survey and the title company furnished their title run. But, I noticed that it stopped short. The title company assured me that their title examiners had been very thorough. But, one cannot always believe everything they hear, can they?

So, I ran title back to when both lots were one. My PO's half was the servient estate (the half that has the burden of an easement). It had been assumed that because my PO's lot was 50' wide, the other lot was 50.' So, the 5' remained a deed gap because it was never dedicated as an easement. This was the 5' the hedge was on and the ground the neighbor thought he bought/owned.

I contacted the Trust holder of the estate that sold off these two parcels, and they issued a Quit Claim for the 5'. I then ordered a new survey. This new survey showed the neighbor's sewer line and roof encroaching into this newly claimed 5'. Then, the neighbor ordered a new survey, relocated his sewer line, and bought 3" of encroachment rights for his roof

He was not a happy dude. He sued his title company.

After participating in this forum, I decided to relate this story because Title companys can screw up, and their title examiners are not "above" it. Be sure that you know what you are getting when it comes to protecting your interests.

Thank you.

Pat