Sorry I posted in the wrong place the first time - I am new to forum.
Landmen in our area are offering $3000 to sign lease with a promise of "the rest of the bonus" in 14 days. They are honest about planning to "sell the lease" to someone else who has money, i.e., investors. I think there is a risk in giving them the originally signed lease without gettin all the bonus simultaneously. Others think that not getting the full bonus would invalidate the lease. What do you think?
Folks. Good gosh! I am a member of a royalty owners association and we discuss these kinds of issues with emphasis on protecting the royalty/mineral owners interests. I manage the minerals for our extended Family and with that responsibility I have guidelines of how to negotiate a mineral lease with the assistance of our O&G Attorney. Under no circumstances would I entertain a “flipper” deal that probably will pay with a draft check that may or may not end up being valid. First rule that we have is know the Operator (Oil and Gas Company) that will actually spud the well and perform the drilling. I won’t negotiate a lease with anyone unless they are a “contract land agent” representing a viable reputable Operator. I insist they divulge the identity of the Company they represent before negotiations can commence. Once the terms are negotiated then the provisions of the lease become very important. Mineral Leases are generally crafted to benefit the Operator. There are many items/issues that need to be addressed. Surface protection if the mineral owner also owns the surface estate. Pugh clause that establishes “pay zones” which can be drilled both vertically and horizontally. Pooling clauses are also important as is a cost free royalty provision. This is why I also recommend retaining an experienced O&G Attorney to craft/modify the provisions of a mineral lease to protect the mineral owners interests. It is our policy to avoid accepting drafts and when we finally have agreement with the Operator we will exchange the signed mineral lease document at the same time the Operator provides a check for the bonus payments.
