I get about $70 a month from my gas well in the Barnett Shale here in Mansfield, Texas. I received a letter from Universal offering me over $7000 for my rights. Was wondering if anyone had heard of these guys or if this legit or not. Did a search with the Better Business Bureau and they were not listed with them good or bad. Is this a bait and switch kind of deal?
I think they know something you don’t Mr. Newton. You may be getting a new well/s. I would be checking with the RRC for new drilling permits. That seems like just too much money to buy out a $70 a month royalty, even if you don’t figure in decline or discount the price of gas. Be wary. Buddy Cotten mentioned a similar offer recently, which he didn’t take, and he has a new well.
How many mineral acres do you own? $7000 maybe very little if you figured it at a per acre price compared to production revenue if it has been producing very long and production is down, but it sounds like there maybe more to it. There have been a lot of companies coming out of the woodwork lately offering to purchase income producing royalties. My mother just got a letter from a Texas company using threats and scare tactics to try and convince her to sell. Anyone heard of Broadmoor land and minerals?
Never heard of Universal or Broadmoor but I have gotten several lowball offers from some outfit that calls themselves Addax Minerals operating here in the Barnett. I’m not one of these guys who says that minerals should never be sold, because there are times when it makes sense for an individual to sell versus to hold. In the past, Ive sold some minerals and have fine experiences with a few companies operating here in the Barnett but this Addax company strikes me as being nefarious. Their ‘landman’ kept telling me that he was ‘in my neighborhood’ seemingly every day, as if he could be at my house at a moment’s notice if I were to decide to accept the less than generous offer that they made me. I also looked at one of their deeds and they try to sneak language in that allows then to collect payments from almost a year in the past before the date that they acquire the rights. Anyway, this Universal offer of 100x monthly cash flow does strike me as unusually high, so either they are highly speculative or they know something that the common man doesnt know, or they just miscalcuated the offer, which has happened to me in the past as well. Not all of these outfits are staffed with rocket scientists. Good luck.
My experience is that you have to be very careful with unsolicited offers. I'm not sure if this is Univeral Royalty Co's practice or not, but many just go through the tax rolls and mail out offers as quickly as they can to as many as they can.
When you call back, they'll go okay I better take some time to figure out what you have. The next offer is often much less. It is a bait and switch tactic. The company puts out high offers to see who is interested and then they do the real homework. I have personally spoken with people who will get an offer like this and then when the real paperwork comes in it is 25%-50% of that number.
Thanks folks. Just got another offer from a company called Black Mountain offering me $5600. Anybody heard of these guys? I only own 1/2 acre where my house sets.
I have interest in 4 wells in the Barnett Shale in Joshua, Texas. I just got an offer from Black Mountain out of Ft. Worth, Texas. I have never heard of them. Also had an offer from Cobra Petroleum Company out of Ft. Worth, Texas also. Then, there is also one from National Royalty Co Ltd out of Dallas, Texas. Offers varied from $4000 to $25,000. These wells are thru Chesapeake. I think I would offer the minerals to them first as they have been a very good company to work with over the past years. That is, if they were competitive.
I also got a offer from Cobra. I cannot find any of these companies listed with the BBB or even have phone numbers in the yellow pages.
I could be wrong but I believe a company will only show up in a basic BBB search if there have been complaints against them. Also, I didnt realize the Yellow Pages still exists so I wouldnt put much emphasis on that. Worry more about the $ they offer you and ensure whomever you sell to pays you in certified dollars in person before you hand over any paperwork. If you need any recs for reputable companies in the area that I’ve dealt with, email me.
Rick Newton said:
I also got a offer from Cobra. I cannot find any of these companies listed with the BBB or even have phone numbers in the yellow pages.
I have a huge problem with the BBB. They have certainly outlived their usefulness, just like the phone book. I throw my phone books in the garbage.
I joined the local Chamber of Commerce, which to me, is being a good corporate citizen. I used my street address for my mailing address, rather than the PO Box that I use for everything else.
The BBB sent me mail to the street address, wanting me to join. I called the people up, and it was $350 a year to join, and get this, they tried to extort me by saying if I did not join, I would only get a "C" rating. I told them they just better not give me any rating because if they did, they were looking at strong litigation. I cannot believe those folks. Also, these clowns denied mining the Chamber list to get new leads. Wow.
In order to be an accredited BBB company, you have to pay money and hang a sign in your office. Then you are accredited. OH, if you want to be an accredited online business, that is extra money. What a rook.
Most people think that the BBB is some sort of quasi-governmental non-for-profit watchdog agency. They are not. They are for profit and not associated with the government.
Dispute resolution! I am proactive in my dispute resolution. If someone has a problem with my fee, I return it to them, no questions asked. I just will not do business with them in the future.
The search giant, Google, had an unsatisfactory rating with the BBB in 2008. Huh? Why? Two, read that 2, unresolved complaints over the past 3 years. I bet a billion dollars that those 2 were absolute lunatics anyway. Incidentally, Google was named the "Top Global Brand" that same year.
Now, someone explain to me how an offer to buy mineral rights be a scam or bait and switch? I suppose if they violated Texas State Law, it could be, such as not disclosing in 12 point type that executing this agreement conveys all or a portion of your mineral rights. But, if could not read and understand the agreement, you would probably miss that also. What would they bait and switch you to? How would they scam you? By offering you a lower price than another might have done given the same circumstances?
If you say that is the case, then how the heck to you buy or sell anything, if there might be a better deal out there.
As to phone numbers -- that is pretty much antiquated in my way of thinking. I have two VoIP phone lines in my office. My TOTAL phone bill is $54 per month for two lines, including everything, even calls to Spain or Italy (both where I have relatives). So not having a listed phone just proves that they are smarter than the average consumer.