I have been approached with an offer to purchase my Royalty Rights on my Oil and Gas Lease in Canadian County, OK.
We are due to close next week. My question is: Is it typical and customary to sign off on my rights to the energy company prior to receiving payment? I have been asked to sign off and return documents, then, once it has been recorded a check will be sent.
This is my first experience with selling any of my interests, is this how it is done?
This has been my experience when signing a lease, though sometimes on first offer they send a check. Don't know the process for selling.
I've always been advised not to sell your mineral rights. Are you sure you are getting a fair price ? Canadian and surrounding counties are a real hot bed right now.
Linda,
While it is interesting and sometimes informative to know what is "customary", I'd encourage you to focus on what makes common sense and provides you a risk free transaction. A transaction in which another party has either of:
a) your signature on any actual conveyance document or
b) a document containing a promise of delivery (of a conveyance)
amounts to either a free option to the buyer, or, the downright exposure to you of non payment. You may be dealing with Jesus himself, but I'd still exchange goods for cash - doubly important if this is any significant amount of $$.
If they really want to buy, they can fly to CA and do a face to face exchange. You are not trusted if the buyer believes you will sell to another before the deed is filed.
On leases around 100K I have received face to face exchange.
We're talking of an amount under 10K...does that make a difference?
Under 10K is chump change for most mineral buyers, I would send you a deed for you to sign along with a check and a SASE.
Thank you for your input. I was leaning toward that position. If they can ask me to trust them, why can't I ask them to trust me. After all, they are the ones that approached me in the first place.
Are you sure you want to sell ? Once you sell it is gone from you forever. I have always been advised NOT to sell, but to lease. Unless you are desperate for money I would suggest leasing. Have you consulted an attorney on this.?
Reggie H.
I would insist on payment at the time of closing. Meet in person. They give you a check, you sign the docs, they record the deed later.
What section/township/range are you in? Did you shop your offer at all?
My Royalty interests were located in Township 14, Section 23, Range 8. No, I did not shop the offer. I hadn't received any royalties on these wells since 2011...something is better than nothing.