As I was expecting, the offer is for $2500 bonus per acre; 3 year term; 3/16 royalty and post production costs among several other clauses. The offer is from Lowry Land Co. Inc. Current lease expires late September of this year. I have slightly over 2 NMA in this section.
I don’t think this is a fair offer from reports I’ve been hearing so I want to negotiate something better. All the previous Oil and Gas leases I had signed, I had blindly accepted the terms of the initial offer. I don’t want to do that this time. So, this leads to some questions that I have.
Do I just send back the unsigned lease to Lowry Land with a note stating what terms I consider to be an acceptable offer?
If I don’t accept this initial offer, would I more than likely be forced into a contract in the end?
How acceptable to negotiating are these land companies? (Probably hard to answer, but I had to ask)
Bonus payment (per contract) states that it will be paid in 2 installments after I have sent in the signed lease. Shouldn’t I request that when an acceptable lease is sent to me, it would be accompanied by a Sight Draft or maybe another form of immediate payment of the entire bonus?
I will more than likely have more questions. I also can try to post a copy of the lease if I can figure out how to do that and if it is acceptable to do so here on the forum. Thanks in advance for any information you can give me.