Replies to This Discussion

Permalink Reply by John Brewster on January 10, 2013 at 4:00

I suppose Pirate's BS comment was directed to me?  I've been in the oil business over 35 years, possibly longer than Pirate.  My comments may reflect an industry perspective but in fact I own perhaps 2,000 net mineral acres.  Obviously, I have been involved in many lease transactions and have negotiated many more on behalf of clients, as recently as the last week of 2012.  Having said all that, there are bad landmen.  I have no tolerance for anyone who is unfair and/or takes advantage of folks who are uninformed.  Offering terms that seem low, based upon the client's instructions/limits, is not unfair - that is just how landmen do their jobs.  They can only offer what the client specifies.  But, scamming people, misleading, lying, withholding information pertinent to an informed decision, those are tactics that are not acceptable and give our industry a bad name.  When someone brings up those kinds of experiences on this site, I am first to be critical (just as Skip Peel would be).  However, in my opinion those situations are rare - thankfully. 

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Permalink Reply by Two Dogs, Pirate on January 10, 2013 at 4:59

BS movie.

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Permalink Reply by Jimburgess on January 10, 2013 at 4:07

John,

I am still hoping that some BIG OIL CO.........national or foreign......will drill one of those

VERY EXPENSIVE WELLS on my GOAT PASTURE ACREAGE that will pay me royalty

for many years to come.  I'm just sayin !!!!!!!!!!!

Jim Burgess

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Permalink Reply by John Brewster on January 10, 2013 at 4:22

Well, there are thousands of people for whom that has been the case . . . all over the country.  The Arbuckle play in SE Oklahoma in the late 1980s was one I was involved in.  Humble folks made hundreds of thousands of dollars, some millions, when their farms where cows grazed became immensely valuable through nothing they did other than own the minerals.  The newspapers are full of similar stories in the Eagle Ford and Baaken.  I am certain we could find the same in the Marcellus and Utica.  With today's technology, it happens every day.

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Permalink Reply by Jimburgess on January 10, 2013 at 4:38

John......I made an attempt at sarcasm in my previous post due to your use

of the words "goat pasture" when referring to the land and minerals owned

by we "humble" folks.   It indicated IMO your attitude as a lease broker to

we mineral owners...who obviously do not appreciate the great opportunity

oil companies provide when they leaase our land and spend millions to

develop it.  If you are a mineral owner rather than a landman then I retract

what I have posted.

Jim

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Permalink Reply by John Brewster on January 10, 2013 at 5:14

Humble folks includes me and my family.  I am a substantial mineral owner, so your retraction is accepted.  The fact is, I personally know many farmers and ranchers, hard-working, middle class people (humble is a good Christian trait, not a criticism) whose land has become valuable and who made lots of money off royalty.  Yes, it would not have happened unless an oil company spent millions of dollars and assumed lots of risks to drill.  That is the way it works.  Those who condemn "the rich oil companies" or feel envy or subscribe to the class warfare that is so heavily promoted by Washington nowadays have little knowledge about how business works and, sadly, many are not capitalists.  You, on the other hand, sound like a reasonable person.  My only purpose in responding was to make the point that there are many good folks whose goat pasture made millions and yes, it started with a lease and an oil company willing to drill wells.  I have also been a landman in my career.  I don't apologize for that.  I was one of the good guys, and most are.  Skip Peel will agree.

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Permalink Reply by blackjackjackson on January 10, 2013 at 5:49

thank you jim and john,

this is the kind of discussion that makes this blog invaluable.

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Permalink Reply by Jimburgess on January 10, 2013 at 9:12

John,

"A man is truly humble when necessity compels him to humble another".

It is true ...I am a reasonable man.  Since you provided insight into your background....I will do the same.  Substantial or small mineral acreage, it matters not to me.  Suffice it to say you are a mineral owner and a landman.  My background in real estate and timberland.  I have no "goat  pastures".  Whenever I receive a lease bonus, I consider it "gravy" or something extra.  I did lease almost 3000 acres to SWN and thought all the landmen were capable and honorable and did an excellent job. I have dealt with landmen and negotiated many leases the last 40 years. 

However, as a reasonable man, I do know that landmen owe their loyalty to the lease brokerage, who in turn, owe their loyalty to the "big oil companies" .  All told, this provides a considerable advantage over the majority of the mineral owners who do not even know how to negotiate.

There is not enough time nor space to have a discussion about class warfare,condemnation of big oil companies, how busines works,or capitalism.........however, one thing for certain big oil is not spending millions developing oil fields to help out the landowners and they have their lobbyists to protect their welfare

Jim Burgess. 

 

 

 

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Permalink Reply by John Brewster on January 10, 2013 at 9:58

Our family are also involved in real estate and timber.  I reject any suggestion that people who own different kinds of real property are less sophisticated.  I have spent my career on both sides of leasing.  I only come to this site rarely, and usually to help people.  Occasionally I feel compelled to respond to someone when it appears they may have a bias which is unfair.  I am pleased that you have had good experiences with landmen.  I do not understand why you persist in attacking oil companies.  You may not fully appreciate the amounts of technology, risk, and capital that their activities require  Moreover, when they lease someone's minerals and that lessor retains 1/8th-1/4 of the royalty, I contend the "big oil" (which you use in a pejorative sense) IS spending millions that does indeed help out the landowner.  Trust me, if people don't lease their minerals no one is going to drill them a well.  Sorry you don't seem to have any respect for oil companies.  They are just people like you and me; men and women of all ages and backgrounds - highly trained, and yes, well compensated, but honest, hardworking, smart people whose job is to make money for everyone that owns a percentage of the proceeds of the sale of produced hydrocarbons.  They are highly regulated, and 99% of the time conduct their business with integrity.  That is all I will have to say on this subject.  You are entitled to your opinion.

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Permalink Reply by Jimburgess on January 10, 2013 at 10:07

Indeed, you have said enough,...Likewise. Jim

Permalink Reply by Two Dogs, Pirate on January 10, 2013 at 11:02

When I use the term "goat pasture" it is when the lessor has another tract near by but  not in my buy area and they want me to lease that tract also.

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Permalink Reply by LP on January 10, 2013 at 5:13

No Oscar nomination for Promised Land. Not even one for best catalog in the outhouse. YAY !

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