I'm trying to help a friend understand about mineral rights leasing in Gladwin, Mi., and he has a couple of things that aren't clear to him.
If a company is going to put a well in a given spot, why bother paying the surrounding landowners anything if you're getting the gas anyway? If it's a legal issue, where you have to pay royalties, why sign a lease from them, and include a bonus per acre as well?
If a well goes in less than a mile from his property, and he doesn't sign, will he get royalties anyway? What would be the benefit to the company to sign him up?
I heard from another friend, about a woman who refused to lease, (even though she'd get about $23,000 if she did), but was told she'd still get the royalties. Is this true? Why would a company want to pay her that much money, if no well is to be put on her property in the first place. In other words, if the well is going up regardless of what she does, why bother trying to get her to sign and take the money?
Part of his hesitation is not understanding "what's in it for them", if he signs a lease, but nothing is going onto his property. And, if he signs a mineral rights lease, he's afraid they might have rights to run a pipeline through his property at a later date, or even drill there.
Any insight in this would be greatly appreciated.