Is it true that the seller needs to get an “escrow payment” of some amount to hold the buyer to the PSA. any help here would be appreciated, thank you in advance
Need to post more detail to understand your question, including state where PSA is located. Are you selling your minerals which are subject to a lease and PSA? Did you execute the PSA? Is the operator or non-operating WI selling the working interests in a lease and/or wells in which you have an interest as a mineral lessee?
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this is in Roger Mills county OK. thinking about selling a portion of my mineral rights. I have heard from multiple people that when there is a PSA agreement, the buyer makes some sort of “good faith” installment before the PSA is signed and notarized. Hope that helps
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The buyer almost never does put up escrow money, but probably should. Unfortunately, there are a lot of buyers out there who are flippers. They will make an agreement to purchase and then try to secure a buyer. If they find one, they will close on the agreement. If they can’t or dont, they will either ghost the seller or come up with some lame excuse. If you have a trusted landman or seasoned oil and gas lawyer, they will know who the ghosters are versus the real purchasers.
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thank you so much! this is invaluable info.
so would you agree that if they are willing to give me even $100 good faith exchange they will hold true to their PSA?
I heard even $1 holds them to their agreement contractually
and if they ghost you, is it too late? do you still own your mineral rights? or have you signed them over and need to hire an attorney to get it back. thank you in advance 
You should not sign a legal agreement unless you understand the terms. Generally an option or escrow payment would be forfeited if the buyer walks off. And the $1 or $100 would not stop someone from walking off. You should instead be concerned that yourdo not sign a PSA which binds you for to a sale and leaves loopholes for the buyer. The agreement contains protections such as automatic termination with XX days if the sale does not close and binding the seller to a set price, not a price to be determined later. And you should absolutely never hand over an executed deed without being paid in full. There are a lot of problem mineral buyers out there who will present a one-sided agreement that is totally in their favor. Based on your post, you do not sound like a sophisticated seller and you should have an attorney review the contract before signing.
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Yes, I am learning. That’s why I am on here, asking questions. Thank you for your blunt directness.
You are wise to educate yourself. There are knowledgeable people on this forum who can answer questions. However, all responses are based on your post to give you some guidance. However, conclusive advice depends on the actual written terms of a legal document read in its entirety, as one clause may override another clause. So any responses are limited to what you post and are not legal advice. In most instances of selling minerals, you are asked to sign a short letter agreement, not what attorneys would classify as a true purchase and sale agreement which is multiple pages. The letter agreement as presented by the purchaser is usually designed to bind you as seller, but leave an out for purchaser. Not the same as a house sale contract. So the price will usually be per acre based on net mineral acres or net royalty acres, with buyer to do title search to decide what you own. How long can buyer take? Or is there no time limit? Are you certain as to what you own? What if the buyer says you own 1/10 of what you thought, such as 1 NMA rather than 10 NMA? Are you forced to sell even if you do not agree? Are your minerals producing or under lease? Have you determined whether or not there are permits or drilling on your minerals or close by which would affect the value? And you should also ask for the buyer’s proposed deed form to review before signing the letter agreement to make sure that is will be limited to the portion of your minerals being sold and not contain broader language for all of the tract or for all minerals you own in the county. On a side note, if you own 1/4 minerals in 20 acres (5 NMA) and want to sell one-half of your interest (2.5 NMA), be careful as to how that is described. If the agreement is to sell 2.5 NMA and it turns out you own own 2.5 NMA, then you will have sold 100%, not half of 2.5. This will depend on OK law and that is another reason to have your own attorney review the language before signing. The world is complicated and you may or may not be dealing with a trustworthy buyer, so please be sure to protect yourself.
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any chance you have attorney recommendations in Roger Mills County?
additionally, thank you for all of that. I see there is a lot that could go wrong.
I can’t tell what you’ve done or haven’t done. If you sign the agreement, then you’ve made an agreement (with some exceptions). Hopefully, you didn’t sign a deed. The deed is what actually transfers the interest, not the purchase agreement. Similar to a house closing. A buyer signs a real estate contract and then at closing, the seller signs the deed over to the buyer. If a sufficient amount of time has lapsed, and you only signed a contract, then the contract may have expired. As Daze said, someone would need to look at the particulars. Now, you don’t need to limit your search for attorneys to Roger Mills county. YOu just need competent oil & gas attorneys.
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I haven’t signed anything. But I have a couple of PSA’s I would like an attorney to look at before and if I sign. Thank you so much.
In addition, it would be wise to check the state treasurer’s office for any unclaimed funds. The buyer would get those as well. Also understand what pending activity is coming. Buyers rarely offer for the profit that they expect to make off of pending drilling. They usually offer a discounted cash flow for the current production.
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Robert Stell at Bass Law in OKC does a good job. I recommend reaching out to him or any of the attorneys at Bass Law.
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Before you sell your minerals I would search the current oil & gas activity in the area where your minerals are located. As someone who owns minerals in RMC, I can say there is a lot of activity and building of infrastructure for current and future oil and gas drilling.
There is plenty of time to sell your minerals if you decide. Just do your research first on the prospects.
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I always demand a payment. After all, you are basically taking your minerals off the market for the duration of the PSA OR LOI. If it closes. the payment applies to the sales price, if not, Seller retains the payment. BEWARE, PSA’S AND LOI’S are generally prepared by the Buyer and are crafted in their favor. Take it to an O&G Lawyer for review. Money well spent.
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If you do decide to sell, you should request a disclosure from the Buyer as to any wells on the property, suspended funds, unclaimed funds, drilling wells, drilling permits, or current forced pooling actions. Unsolicited offers are many times predicated on recent activity or unclaimed funds. Request that any disclosure be made in writing. As far as executing a PSA, I suggest not executing since it does not benefit your position and only benefits the Buyer. Unless you are an industry professional or have professional assistance, a PSA will not serve to protect your interest. Once you have completed your due diligence and agree to the terms, tell the Buyer they have 20-30 days to close.
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