The family inherited land and mineral rights for the subject property and recently received an offer for a multi-unit horizontal well from Marathon Oil. As many of you know (because we don't have the best clue), we have been presented options that include chipping in for the well - that's a no go, a lease/assign of interest to Marathon for a cash consideration of $1,350 per net mineral acre delivering an 81.25% net revenue interest (3/16 lease royalty) or the same but for $750 cash consideration and a 80% or 1/5 royalty lease.
First question, any word on the activity in this area and second question is can someone just throwdown a quick "you're a dummy" breakdown of the payouts? I've read that the net mineral acre is typically found on the title of the land but I don't have it handy I'm just trying to help my mom out with this stuff best I can.
The property was split amongst the "sisters" of the family, i.e. my grandma and my great aunts. Just an FYI - we are looking to get a local attorney or a "landman" to assist with this and I know that's generally the advice - but I thought I'd come here just for some real quick insight to understand the payout and perhaps some advice other than "get an attorney".
SO, question is, what is the royalty 3/16 or 1/5? The royalty on production? If we have multiple units/owners, is that applied across the board somehow and split amongst us or is that just our split. Is there a way to find out the net mineral acre other than having the title in my hand?
Sorry so green here, again just trying to understand this best I can for the family. Thanks for any help you can give ...doesn't have to be real in depth or anything - just looking for a quick breakdown of the jargon and a "ask for more dude!". You're awesome! THANKS!