Negotiating bonus in Duval County, TX

Oil and Gas Leasing Help
#1

I'm new to this site and every thing about leases. Our family has mineral rights, no surface rights in Duval county, Texas. I've read articles in the paper of people in and near the Eagle Ford formation receiving $2000-$3000/acre signing bonuses. My question is , are these based on 100% ownership of the mineral rights. We own a small percentage, 1/32 , and have only been offered $100/acre. It seems logical to me that a smaller percentage would translate into a smaller bonus, but some in the family want to hold out for more. I realize that everything is negotiable but only to point. Any thoughts or input is appreciated. Thanks

#2

Mr. Young, it may be helpful if you shared how many net acres you have. The answer may be different depending on whether you have 1/32 of 32 acres or 1/32 of 10,000.

#3



r w kennedy said:

Mr. Young, it may be helpful if you shared how many net acres you have. The answer may be different depending on whether you have 1/32 of 32 acres or 1/32 of 10,000.

#4

The property is approximately 180 acres. Being new to all of this , I'm not sure of the term "net acres"

Don Young said:



r w kennedy said:

Mr. Young, it may be helpful if you shared how many net acres you have. The answer may be different depending on whether you have 1/32 of 32 acres or 1/32 of 10,000.

#5

Mr. Young, barring any prior reservation that would reduce your % interest in the acreage, 1/32 of 180 would yield 5.625 net acres of a gross of 180. I doubt you would have leverage due to such a small acreage position, but I see no reason why you should be limited to $100 per acre if those around you are receiving $1,000. I would say to seek a competitive offer elsewhere or research how much people have received in your area and make a counter offer. The first lease offer made to you is frequently far below what they are willing to pay. Those that do not ask, do not get.

#6

Good point! Thanks for explaining the net acres too.

r w kennedy said:

Mr. Young, barring any prior reservation that would reduce your % interest in the acreage, 1/32 of 180 would yield 5.625 net acres of a gross of 180. I doubt you would have leverage due to such a small acreage position, but I see no reason why you should be limited to $100 per acre if those around you are receiving $1,000. I would say to seek a competitive offer elsewhere or research how much people have received in your area and make a counter offer. The first lease offer made to you is frequently far below what they are willing to pay. Those that do not ask, do not get.

#7