First of all, thank you for your input. This is all very new to me and I am looking for any assistance I can get. My family recently discovered we have the rights to about 80 acres located in the E. Allcorn Survey, Abstract No. 2 in Washington County, Texas.
The land man (Acaval Land Company) representing Blackbrush Oil and Gas sent an offer to purchase a paid up gas and oil lease.
Terms are as follows:
Oil and Gas Lease Bonus $500 per net mineral acre
Primary term 3 yrs
Oil and Gas royalty 22%
My extended family leased the adjacent lots some years ago for $800.
This is probably a stupid question but does “Oil and Gas Lease Bonus” mean an up front starting payment?
Does anybody have any idea if these terms are fair or any insight into the area and these types of arrangements typically look like in the area?
“Paid Up” lease
“Subject to the proportionate cost of transportation, excise taxes,” (22% of net proceeds)
I think this means they aren’t offering a “cost-free” lease
There are other terms I really don’t understand so any advice about things to look for would be appreciated.
Thanks so much for the assistance!