Top Lease Agreement

Texas Mineral Rights Martin County, TX
1

I have received a Proposal for a Top Lease Agreement in Martin County Sec22, Blk37, TS1S. Can anyone answer some questions?

2

Hi Suzanne -

Iā€™m in Martin County. What kinds of questions do you have?

3

So sorry yo drop the ball. Thank you for your reply.

What is a fair price? And what should I look for in the lease? I know itā€™s a general question and may require me to go to law school. :grin:

4

The simple answer is as big a bonus as you can get, the largest royalty you can get - in Martin right now that is usually 25%. And the shortest lease term. Leases are complicated and it is better to consult with a professional offline about your individual situation. NARO also offers a wonderful publication- Look Before You Lease. It is a plain spoken publication that I think you would find very useful.

Thanks! Lana

5

Thank you for the info. I have visited the NARO site but canā€™t find a link to that publication. Can you please send it?

6

Unfortunately it is for purchase. Are you a current member of NARO? If not, there is a membership drive right now and new members can join for as little as $50. Membership includes a lot of informative webinars and other content you might find of interest, including a discount on books including this the leasing book.

7

Thank you! I will check into membership. I have a specific question:

The cover letter on the lease agreement says: ā€œupon a determination that the old lease is no longer valid then we have the right, but not the obligation, to pay the 90% balance within 90 days of release of the old lease.ā€ Does this mean they donā€™t have to pay it within the 90 days or does it mean they donā€™t have to pay it at all?

8

I will let the attorney answer that question about the 90%.

My two cents as a mineral owner is not to do a top lease. I am attaching a very good article regarding the pitfalls.
An Overview of Recurring and Related Issues Involving Top Leasing.pdf (210.2 KB)

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