I have a pdf of an oil and gas lease(inherited rights). In the past a cousin always advised us on these things but she is now in assisted living and not able.
We inherited this from our grandmother and then mother, I know of 2 properties but there may be others.
Here are the basics on the current offer
property is in nueces county
They want to lease 80 of 150 acres
say they plan on drilling immediately(1 well)
Say they will use 40 of our acres and 40 of an adjacent property
offering us $100/acre ($8000)
20% royalty
The Landman says the well will straddle the 2 properties equally and that is why we get 1/2.
If someone with a lilttle knowledge could look at the contract and let me know if it is fair and reasonable I would appreciate it.
I don't have an answer for you due to I am having the same questions about the lease I was offerd. But hopefully someone with some knowledge will get back to you so I can persue further.
It doesn't sound like a good deal to me. I haven't heard of anyone offering only $100 an acre bonus in years and 20% royalty is low. I would try to lease them the entire 150 acres and require that 2/3 of your property be included in a pool. Any lease given to you by an oil company is going to be very slanted in their favor. I re commend you hire a good oil and gas lawyer or mineral manager to represent you. It is well worth the money! An oil ad gas lease is not a do-it-yourself project. There are way to many pitfalls.
Thanks for the advice and I am talking to a mineral manager now
I figured the $100/acre was as low as it is since its in nueces county which doesnt have much activity? We signed leases in 2001 and 2011 at $50 per acre, based on advice of a family member who was also a stakeholder and we presumed knew more than we did
6th Generation Texan said:
It doesn't sound like a good deal to me. I haven't heard of anyone offering only $100 an acre bonus in years and 20% royalty is low. I would try to lease them the entire 150 acres and require that 2/3 of your property be included in a pool. Any lease given to you by an oil company is going to be very slanted in their favor. I re commend you hire a good oil and gas lawyer or mineral manager to represent you. It is well worth the money! An oil ad gas lease is not a do-it-yourself project. There are way to many pitfalls.
Try to get a drilling commitment from the company and if they aren’t being truthful about drilling right away, they will try to weasle out of that very quickly by not agreeing to it in the lease. I wish you the best of luck!