should I worry if the operator who wants to lease is not listed anywhere..... Not on MBOGC's list of operators nor anywhere on mineralweb? It also has an unworkable, little info website with no way to contact.
the land is in Montana, but, I'm in California. I don't understand what you mean by Oxy or Venoco or Plains.....are you saying that the operator could be drilling with a partner? I will be speaking to a rep next week. A good question could be just that.
J S Morgan said:
First off, who is the operator offering a lease? Is your land in Cali?
The company picking up the acreage most likely won't drill it without partners. Sorting out if its Oxy or Venoco or Plains that the unknown operator, Joint ventures the area with can be tough. Even Canadian company CNRL has some acreage in the Monterey and San joaquin.
Eleanor-I'm in Montana....can you give us more information? who is the company and where are your minerals located? Has there been any activity close to your holdings?
the operator is US Enercorp out of Texas. Minerals are in Sheridan Co. Hard to know how close activity has been, but, there are listings with a township number one less and a range number one less than ours.
Eleanor McNeil said:
the operator is US Enercorp out of Texas. Minerals are in Sheridan Co. Hard to know how close activity has been, but, there are listings with a township number one less and a range number one less than ours.
thanks for this Clint. I have been at their site and find it useless. My interest is in Montana. Their site only mentions specific operations in s. Texas. Thought I would contact someone on their contact list, but, there is no way to link to them. The links on their site are just that...links any site can pick up to fill their page and look authentic.
Eleanor,
You may be dealing with a leasing agent or company and not an operator at all. When you talk with them again, ask if they are registered with the Montana Regulatory bodies. Also just ask which operator they are working for.
Here is the Montana SOS site where you can check if they are registered in MT. They are registered:
It appears they registered their business in MT in 10/2011. So they must have some presence out there, some leasing and hopefully drilling game plan.
but personally I think mineral owners should "worry" regardless whether the leasing company has a poor or great website. It is important to look into them. Google them to see what you can learn. Ask at websites like this. Google the person's name and even phone number of the person that is contacting you about the lease. Check better business burea, etc. Ideally you are leasing directly with a driller although it is common to lease with a land leasing firm that the "client" has hired to secure mineral acreage in an area. my personal opinion is to get the identification of the "client" and not to lease with flippers/investors (that is just me though).
Then remember, any lease they present is heavily weighted toward the gas/oil company. So you'll want to carefully consider its content. many here also recommend not providing the signed lease without getting money "in hand" using an escrow service can help (i.e. once paid, the original signed lease is sent to the lessee).
Your doing the right thing - asking questions.
Wilson
thank you so much, Wilson. This has been the best information and a relief to know that they are at least registered as a business. Yes, my first thought was to Google the person I am talking to tomorrow, but, he/she only signed with a first name from an i-phone, yet. I originally found this person through the land agent's website. I am dealing only with the land agent hired by U.S. Enercorp. Included with the lease that I am to sign, there is a 'Bonus Payment Receipt' to sign and I intend to hold on to it until I get money in hand.
Thank you again.....Eleanor
Eleanor,
what we don't know is if Enercorp is the final recipient of the lease; they may be leasing in the area on their own behalf or for someone else or in hopes of forming a joint venture with another company.
You would also want to make arrangements for the shortest payment term (some suggest 10 days) in which Enercorp would need to make the bonus payment. You would not want to provide them with any original documents until you have the money cleared in your bank account (a bank draft or site draft is trouble and shouldn't be considered real money). I also suggest that you have them sign the documents that you are requested to sign and have them initial every page as well. They could be given a copy - with COPY written on it so there is no chance it could get registered. Again, the original is provided to them (via escrow arrangement or similar) once you have the money (as promised and on time).
Again, I don't know the company you are dealing with so i can't vouch for them or how well your deal will go. Keep doing your homework. Take your time. If possible, talk to neighbors and join together with them if you can because there is better negotiation stretch in larger acreage holdings.
And finally, I would suggest having an attorney review your lease before you sign into a deal. Keep in mind that the gas/oil company has leased for years and they are experts - how many have you done? like most landowners, we don't do many in our entire lifes so we are "fish out of water" - - - and we don't want to get speared!
Good luck!
Wilson
Eleanor McNeil said:
thank you so much, Wilson. This has been the best information and a relief to know that they are at least registered as a business. Yes, my first thought was to Google the person I am talking to tomorrow, but, he/she only signed with a first name from an i-phone, yet. I originally found this person through the land agent's website. I am dealing only with the land agent hired by U.S. Enercorp. Included with the lease that I am to sign, there is a 'Bonus Payment Receipt' to sign and I intend to hold on to it until I get money in hand.
Thank you again.....Eleanor
Wilson, I am not the land owner, only an owner of mineral rights, my first and only. An attorney has reviewed the lease and given valuable points of negotiations.
. Can I expect this land agency rep to be able to agree and follow through on all the arrangements that you have suggested here without being authorized by US Enercorp?
Eleanor,
Good work having an attorney review the lease. Hopefully he/she is an expert in gas/oil in Montana - this is essential. This isn't simple contract law so the atty has to be experienced in gas/oil. Also if they are experienced in that region/county of MT then they will also likely know competitive terms from others they have represented.
Now will the landman do what I have suggest? probably not. they are scripted with a offer procedure; that is a bank draft or something that specifies some payment term and delay to pay. He also won't likely be able to alter the lease per your attorney's input. However, the landman will have the ability to speak with his company to make the needed arrangements or at least negotiate with you about it.
By the way, generally the lease won't state the terms (bonus and royalty) and this is covered in another document which covers that. The lease would get recorded at the county courthouse (but they want the terms kept secret). Again, they won't have your original lease until you have their money - then they can record it.
Good luck when you speak with the landman. You are in control and I strongly suggest you only sign if you are comfortable with the deal, the landman and the gas/oil company. I hope you'll get terms that will satisfy you and of course, ultimately a producing well!
To help others reading this post; would you mind sharing what terms you are being offered? and how many acres (mineral acres) you are talking about. By terms I mean; length of lease, extension option (I hope not), royalty amount, sign bonus amount.
and also to be clear - I don't know US Enercorp so I have no way to tell you if the deal is legit.
Wilson
Eleanor McNeil said:
Wilson, I am not the land owner, only an owner of mineral rights, my first and only. An attorney has reviewed the lease and given valuable points of negotiations.
. Can I expect this land agency rep to be able to agree and follow through on all the arrangements that you have suggested here without being authorized by US Enercorp?