Thank you for all the replies, I really do appreciate it.
In response to the question of the landman's mishandling of the Moffat County lease. My sister in law (my older brother is deceased) and I, who negotiated the lease with the company. While we both were new to the oil and gas leasing, both of our jobs were primarily "contract negotiating" - 80% of my job was negotiating research contracts with pharmaceutical companies, 14 years for a major university, another 15 years for a large research hospital. My sister-in-law who is now semi-retired, continues her work negotiating contracts with with the federal government for elderly care plans. So we while we knew very little about contracts vis a vis the world of oil and gas, we spent days of hours on the phone "self-educating" on the business - in other words, like Icarus, we flew to close to the sun. That being said, we both signed very favorable contracts for the Moffat lease. Where we took a wrong turn was accepting that the landman had the right information. But clearly he did "skim" the documents which deeded the property to the "Trust" that was in my mother's name, presumed that the beneficiaries were her four children, found the names of her four children by examining the probate records. He didn't do enough discovery to unearth the salient details - that the Moffat County minerals were designated for my mother herself and her 5 siblings. I didn't mention that the landman's company forfeited the sizable signing bonus with sincere apologies. I will consider your advice about forming a corporation among the cousins, but I suspect that there will be one holdout, so I have my doubts that it can be accompished. There were also irregularities in the handling of my mother's estate by her attorney - some of mothers leases were found in a cardboard box in the attorney's office, and he had not listed them in the inventory of the estate when it was probated. He also shipped off the cash in her estate to his brother's investment firm, and that part of the estate was diminished by 35% while his brother was handling it.
The surface rights. My great great grandfather was an early pioneer who brought his 9 children in a wagon from New York to western Kansas by way of a side trip to Wisconsin. His 10th child was born in the wagon in Council Grove, Kansas on the way to Stafford County, KS. My great grandfather and grandfather acquired a great deal of real estate in western and central Kansas over the years when it was suitable only for dry land wheat farming. When oil was initially discovered in the area, there was little income as oil and gas were cheap. That was followed by a long period when the wells were "burped", and I don't remember the details of that period except that mother told me that sometimes the checks were less than a dollar a month. The big boom for them didn't begin until the 50's. Unfortunately, my father didn't "teach us the business" when we were growing up. The only thing I remember was that he repeatedly told us NEVER to sell the land. My mother remarried in her late sixties after my father died. Without our knowledge, her second husband, a highly respected retired general, sold off all the land and comimingled mothers money with his own. He died shortly after that and we had no idea he had sold the land until his death. A few years later, I received a surprise check from a lawyer's office for approximately $45,000 in settlement of a class action lawsuit agains BP - the case has been filed 17 years previous - the legal fees were approved by the court at over 50%. When the boom started in the '80s and gas prices soared, my monthly income from my share of the wells was typically around $4500; That has diminished by 60%. This entire process has been disheartening and painfull, and has taken up so many hours of my life that I would have much preferred spending with my grandchildren. Since the land itself is gone, I'm not sure I want to hang on to the minerals either. I think I will leave it up to my children to decide while I'm living. This seems such an unpleasnt business, and to have a professional take over at this point would cost me more than the income from my leases. It would be a good thing to educate your future heirs about this business. Write it down. Show them where the files are. Teach them about county taxes. Tell them how much work it is to handle yourself, and how much it costs to have someone do that for you.
I am sure my father is turning over in his grave.
r w kennedy said:
Ken G, I think the government may have you concerned, and rightly so with anything government does. The situation Ms. Bicknese would on the face of it appear that a landman may or may not have just skimmed over the deed. I have no way to know. What I do know is that I have been effected by poor landman work several times. That a landman wrote a memo to the TO person that had no basis in fact whatsoever so that even 4 years after production neither my brother or I were being paid. The operator said I had no interest , that my brother had interest in 1 well and that he might have interest in another well. Since the operator has been made a party to my lawsuit, I am confirmed in 4 wells, and with the exact chain of title my brother is still confirmed in one well and they still think there is a possibility that he may have ownership in another well, after 5 years, because of a landmans memo with no basis in fact. My brother's and my interests are identical. I and my brother have had landmen participate in fraud against us. I am frequently unhappy with landmen to the point that I would almost welcome the federal government taking all minerals because that would put an end to the abuses perpetrated by landmen, because there would be no landmen. That is saying alot for a rabid property rights supporter such as I. Ken G, I do not know you from Adam, but I can count on the fingers of one closed fist the number of times I have heard a landman speak out against anything another landman has done and until I do, I cut landmen little slack. I recently caught the VP of Land for an operator making false statements to a federal agency. It never ends. Most mineral owners don't have the time I do to keep watch. I won't even address the misinformation, untruths and terror tactics that are commonly used, that are related here all the time. I think there would be so much more except that, the number has been thrown out that 85% of mineral owners execute the first lease they see. If the mineral owner gives absolutely everything the lessee wants with no questions asked it seems to me that there should be little opportunity for any abuse, and yet so much exists. I had a man recently contact me and he executed a pitiful lease, $75 per acre bonus and after receiving the lease the landman having his lease in hand, called him back to say that they still wanted his lease but would only pay $50 bonus, when they had his lease in hand and so could not lose the acres, they wanted to beat the price down. I told him to demand your lease back or payment of the original amount and that any further communication be done by mail. There is just no end to it. I hear the there are a few bad apples in every profession line all the time. When I made my living as a diesel mechanic i had to do an out of the frame overhaul on a relatively new Cat diesel engine because another mechanic all the way acroos the country used the wrong part and I offered to testify in court if the man sued them, traveling on my own expense. When I made my living as a construction plumber building schools , sports stadiums, hotels and prisons, I couldn't count the number of plumbers, including master plumbers that I ran off jobs because it's a matter of public health and I wouldn't sign off on work that was not up to code. I guess I am just a dying breed but hopefully I will be able to call it like I see it for another 30 years or so. As I said above Ken G, I don't know you and you could well be one of the good guys. There are some landmen that i would place my faith and trust in, I just have not met many that fit in that category and have become familliar with so many who do not. I hope you don't take this personally, but I don't think landmen need defending. I have heard more attorneys say more against other attorneys than landmen against landmen, and you can believe me that attorneys present a united front in almost all occasions. Have a great evening.