Mineral rights contract section 10

Hi, I am looking for any advice I can find on rather or not I should sign a contract I received in the mail, my family and I have just learned of the mineral rights from a company wanting us to lease our mineral rights to them, they are offering $150 dollars for a 3 year term with sign on bonus with a 3/16 royalty or a $200 sign on bonus and 3/16 royalty for a 3 year contract with a 2 year optional. The land is Section 10 township 5 North Range 1 East, McClain county. The 3/16 is for gross proceeds, as far as a dept clause goes it reads , when requested by the lessor, lessee shall bury his pipe lines below plow depth. .It is a total of 25 acres, which of course is divided among the family.

Thank you in advanced for any information /advice you may have

If this was your first offer, it may be a bit low. I just got $200 3/16 for sections 17, 27 and 8. Do not take the two year extension! Read the contact carefully. It may say gross proceeds for oil, but check the gas paragraph, which probably has something about deductions which you do not want. Do not warrant your title, get a depth clause, no deductions clause, Pugh clause, limit your shut-in payment to two years cumulative, not consecutive.

Read the last six months of comments on this forum to get a feel for what is going on. You probably do not have Woodford in very thick quantities here, so this is for more conventional drilling. If the offer is from Heller Oil, then they are probably leasing for Ranken Energy which is doing most of the drilling here.

Thank you so much for your reply M Barnes, and yes it is our first offer from Heller Oil, we are going to take your advice concerning all of the clauses we need to ask for , but I have no idea what a Pugh clause is, if u could please enlighten me on that I would appreciate it. We are not signing any contract with the 2 year optional , thanks to you.

Why don't you friend me on the link above and I can walk you through it. If your contract is the same as the one I received, then it will be easier to tell you.