We have been contacted by a guy who says he represents Nisus Energy. We are a complicated family and he wants us to sign a 9 month option with him to allow to bring title up to date. Most of this work has been done as we were close to a deal with a Landman in 2007. If at the end of 9 months they wish to proceed he is offering $150 an acre for a 3 year lease with a 3/16 royalties of oil or gas is found. Does this sound ok?
Thanks in advance!
The going rate is about $500 per acre and 25% royalty.
I would not give anyone a 9 month option. It sounds like this man is wanting to tie up your land while he shops the deal with some oil company. You would not be able to lease your minerals if a better deal came along, and at the end of 9 months you could be left holding the bag with no lease and no money for having tied up your minerals all that time.
Unless the lease was negotiated in advance, you wouldn't likely have any say regarding the lease. There is also the danger that once the option agreement was recorded in the deed records, you might have to hire an attorney to file a lawsuit to remove the cloud from your title (if a release wasn't filed).
I would run as fast as I could from this deal. Now that you have an estimate of the going rate of the bonus payment for the minerals and the royalty perventage to work with, there should be other interested companies in the area that you can negotiate with on a lease, rather than an option. It should not take 9 months to run title.
Thanks for the info - I have to say I was beginning to smell a rat with this guy but when you are new to the game, it's hard to know what's right and what's not. It also sounds like the price per acre and royalty offer is way out too.
Can anyone advise me on how best to proceed next? I am UK based. What is the easiest way to find out if the Mineral rights we have might be valuable.
Our family has Mineral rights to a couple of thousand acres in the following counties Angelina, Cherokee, Smith, Walker and Nacogdoches.
What part of Nagcogdoches county are your interests? Bonus payments could be considerably more in the southern portion. Mike R said:
I own acreage in north Angelina County and EOG Resources and Goodrich Petroleum are leasing heavily. I would suggest that you “sit tight” and let them come to you. Both have contracted 3D Seismic work to Global Geophysical, so drilling is planned. If you’re in a good area, you’ll eventually be contacted.
I also agree with James that the going rate is $500 per acre bonus with 25% royalty.
Sam Teer said:
NACOGDOCHES AND ANGELINA COUNTY HAVE HAYNESVILLE/BOSSIER SHALE POTENTIAL. THESE CAN BE HOT COUNTIES RIGHT NOW. MY RECOMENDATION TO YOU WOULD BE TO HIRE A LANDMEN OR ABSTRACT COMPANY TO RESEARCH YOUR MINERAL INTEREST IN THESE COUNTIES. I AM A LANDMAN IN THE PERMIAN BASIN(WEST TX) SO I COULD NOT BE OF HELP, BUT I DO HAVE SOME CONTACTS IN THAT AREA. SHOOT ME AN EMAIL IF YOU NEED ANY HELP steer@jimar.com .
Mike, sounds like a good plan. I'm sure you are watching the production of the SW Henderson Hay Unit. Are there any other Haynesville wells in N. Angelina county?
Mike R said:
Gary, my property is located in the JR Crofton and Caleb Hollway Surveys in North Angelina County, TX. It appears that EOG's sweet spot may extend into north Angelina County, so I don't plan to lease for a bonus that low. I'll wait until a few exploratory wells are drilled to then establish the value of my minerals.
I base my bonus comment on current Goodrich leasing north of Zavalla in Angelina County.
Gary St. John said:What part of Nagcogdoches county are your interests? Bonus payments could be considerably more in the southern portion. Mike R said:I own acreage in north Angelina County and EOG Resources and Goodrich Petroleum are leasing heavily. I would suggest that you “sit tight” and let them come to you. Both have contracted 3D Seismic work to Global Geophysical, so drilling is planned. If you’re in a good area, you’ll eventually be contacted.
I also agree with James that the going rate is $500 per acre bonus with 25% royalty.
Sam Teer said:
NACOGDOCHES AND ANGELINA COUNTY HAVE HAYNESVILLE/BOSSIER SHALE POTENTIAL. THESE CAN BE HOT COUNTIES RIGHT NOW. MY RECOMENDATION TO YOU WOULD BE TO HIRE A LANDMEN OR ABSTRACT COMPANY TO RESEARCH YOUR MINERAL INTEREST IN THESE COUNTIES. I AM A LANDMAN IN THE PERMIAN BASIN(WEST TX) SO I COULD NOT BE OF HELP, BUT I DO HAVE SOME CONTACTS IN THAT AREA. SHOOT ME AN EMAIL IF YOU NEED ANY HELP steer@jimar.com .
I only own a working interest in a lease in Angelina County, so I do not want to tell you how to handle your business. But I would never sign a seismic permit before a lease. You never know what the 3D is going to show(faults, etc.) In my opinion it is alway in the mineral owners favor to sign a lease before any seismic permiting