Offers for purchasing mineral rights


#1

I have mineral rights for property in Howard County. I have been contacted by several companies offering to purchase the rights. Has anyone had any contact with H.B. Suffield a landman or Brett H. Lewis? I am aware that several people have signed over rights only to find out they were actually scammed. Also, I would like a basic consultation with an attorney to provide legal advise. Any information would be greatly appreciated


#2

Why sell? Do you need the money or do you only own a small interest? Have you leased your minerals? If not, I recommend you wait for a “real” company to lease them. Don’t lease to someone who intends to flip it to someone else.


#3

Beware of a typical scam that a guy tried to run on me. In the PSA (Purchase Sales Agreement) there were caveats re 1/8 and 3/16 terms which changed the sales price (1/3 sales price if 1/8 lease, 2/3 the sales price if 3/16 lease, full price if no lease). This certainly triggered my curiosity so I researched and I found that there was one well on this property that was holding production and it was a 1/8 lease from 40 years ago (producing about 150 barrels a month for all that time). My royalties were so small that I received only 1 royalty payment per year and the reporting company was not the same as the operator so I did not realize that this property (section) was even leased or what the terms were. If I had signed the PSA, I would have been obligated to sell the property at 1/3 the price we had agreed to. Consult an attorney for sure and, among other things, insist that all sales price caveats be removed from the PSA and insist on the most simple PSA and mineral deed, with almost all conditions, contingencies, and “got-chas” removed.


#4

Robert is correct on using an attorney. It is cheaper before than after the deal. Also, do not warrant title. Make them do their own due diligence to determine what they are buying.


#5

Any reputable buyer will be conducing their own due diligence (title search) and shall take care of all fees and costs associated with that. If they are requiring some sort of warrant only warrant the title “by, through, and under” which means you only warrant the title during the time it was under your ownership. That type of warranting is fairly common in mineral transactions.


#6

Don’t sign those for sure! I received one. No way!!


#7

Anything in the west half of Howard County is worth at least $125,000 per acre.