I just heard about this area and now am looking at some initial offers from Landmen. My family wants me to negotiate for all of us and we have rights in T6N, R61W sections 7,19 & 30 and 62W sections 25 about 372 net acres. Just hired Cyndi Zeren to verify other areas of interests since we had several family farmers in the area with patents. Friend in the industry told me to ask for $5000/acre, 1 yr lease, 20% Royalty but it sounds very unrealistic…or is it?
Yep, that is probably unrealistic. Have you read the posts on Weld County? My independent landman said current rates in Weld County are $2700. I didn’t get clarification as to whether that is the average over the whole county, or in the “hot zone”. Judging by the COGCC website, areas to the east of about range 63 don’t have nearly the activity as to the west. The 20% royalty is realistic. I think I’d aim for a 2 to 3 year term.
I have started to read all I can find. Still figuring out this website. My family asked me to negotiate for all of this I want to do the right thing. You hired an independent landman? I have also seen a lawyer that seems to be representing owners? I will definately have the final contract reviewed by an attorney but paying one to negotiate?
Lisa said:
Yep, that is probably unrealistic. Have you read the posts on Weld County? My independent landman said current rates in Weld County are $2700. I didn’t get clarification as to whether that is the average over the whole county, or in the “hot zone”. Judging by the COGCC website, areas to the east of about range 63 don’t have nearly the activity as to the west. The 20% royalty is realistic. I think I’d aim for a 2 to 3 year term.
We spent months negotiating, and then we hit a wall. At that point we hired an independent landman to see if he could get us a better deal, and then to negotiate the lease. He did get us a better deal, and we have a killer lease. We then had an attorney spend a couple of hours reviewing the lease to make sure we were adequately protected.
Did your landman charge a flat fee or a percentage?
Lisa said:
We spent months negotiating, and then we hit a wall. At that point we hired an independent landman to see if he could get us a better deal, and then to negotiate the lease. He did get us a better deal, and we have a killer lease. We then had an attorney spend a couple of hours reviewing the lease to make sure we were adequately protected.
We paid 25% on the increase in the offer that he obtained. We were at $750, and he got it to $1000. So, we paid him 25% of $250. I don’t know if we could have negotiated a better deal with the landman or not. A few people from our neighborhood met with him, and those were the contract terms they returned with.
Jay Lake said:
Did your landman charge a flat fee or a percentage?
Lisa said:We spent months negotiating, and then we hit a wall. At that point we hired an independent landman to see if he could get us a better deal, and then to negotiate the lease. He did get us a better deal, and we have a killer lease. We then had an attorney spend a couple of hours reviewing the lease to make sure we were adequately protected.