Replies to This Discussion

Permalink Reply by Joe Aldridge on December 5, 2013 at 0:49

Skip,

I would like clarification from this person as to whether this is investigatory to take to the AG or whether its for new legislation to limit the mailing of unsolicited offers. If its the latter then you don't know where its going to end. Technically, a call and an offer by phone, either a sale or a lease, is not legal if the person is on a "Do Not Call" list. If the is legislative is this going to be similar?

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Permalink Reply by Skip Peel - Mineral Consultant on December 5, 2013 at 2:50

Joe, there may be some more specific information available in the future.  If so I will post it.

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Permalink Reply by Two Dogs, Pirate on December 4, 2013 at 15:51

CS this ain't got nothing to do with solicitations from mineral owner. It has to do with blanket mail outs from mineral buyers that are not on the up and up. Skip will have to clarify this but this is the way I read it and it has been a long time coming for the State of Louisiana to drive the stake through the heart of these snakes.

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Permalink Reply by RONNY on December 5, 2013 at 0:25

I wonder if this same legislator would be brave enough to drivie a stake through Chesapeake's heart. 

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Permalink Reply by Aubrey C. Sanders, Jr. on December 5, 2013 at 6:54

For more than 30 years I have served as "watchdog" for my little part of the world [North Shongaloo-Red Rock Field] regarding fraudulent offers to buy minerals. For many years there was a company with "Southwestern" as part of its name. I have seen many, many of their offers. At one time they would describe a certain tract of land. Then they would include statement to the effect that said offer was intended to include all your lands in Said Parish.

For many years I knew a family owned company named "Cobra" -----------? This company was a very good company and drilled many wells in NSRR. I became very involved with him trying to negotiate some leases with them  about 12 years ago, and continuing for several years. I was told that this "Cobra" was owned by Dillard family of Little Rock, and that when Mr. Dillard died the family elected to get out of the oil business. I can only presume that they sold their Cobra. As far as I know there is no relationship between the 2 Cobras.

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Permalink Reply by Aubrey C. Sanders, Jr. on December 5, 2013 at 7:00

Skip, can you give us name of the legislator? Think I may know him. I am talking about Henry Burns in Bossier.

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Permalink Reply by Skip Peel - Mineral Consultant on December 5, 2013 at 7:11

Aubrey, I'm not authorized to divulge anything other than what I have already posted.  This discussion is intended to acquire copies of Cobra letters sent to mineral owners in NW LA.  It is not intended to rehash the many prior discussions we have had concerning Cobra.  I will not speculate on who is involved in this effort nor what their ultimate intent may be.  By all means feel free to contact Representative Burns or any other state legislator to express your concern for the manner in which Cobra solicits the purchase of mineral interests.  I'll post any information that can be made public after the committee review.

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Permalink Reply by 1kw6x71km1v37 on December 5, 2013 at 7:52

Two Dogs,

"Not on the up and up" is not a good legal footing. It's either a good mineral rights deed or a bad one. Misleading offers to buy are subject to the owner's scrutiny. He or she has the burden of evaluation, and also has the right of rejection. It's buyer beware, just like any transaction without a warranty or written guarantee. Yup. Must be approaching election time in NW Louisiana.

In one respect, scuzzy low-ball offers like those under discussion are beneficial to the landowner in that it tells prima facie who not to do business with.

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Permalink Reply by Skip Peel - Mineral Consultant on December 5, 2013 at 9:06

Generally speaking the Cobra offer letters are very carefully worded and I imagine have been assiduously reviewed by the firm's legal counsel.  I find nothing about them that I would consider to be illegal.  And a careful reading reveals that the check is actually a draft and that the form on the back of the letter is a mineral deed.  I think I know where this review is headed but don't care to speculate at this time.  I'd rather the committee perform their review and make their recommendations and then see what happens.  Either way I'll update the discussion as to the out come.

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Permalink Reply by Skip Peel - Mineral Consultant on December 5, 2013 at 13:21

Thank you to those who have responded to my request.  I'll update this issue in the future.

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Permalink Reply by Skip Peel - Mineral Consultant on March 23, 2016 at 8:02

A little over two years later, here is a summary of the proposed legislative act.  The actual enabling language is eleven pages in length and can not be posted in its entirety here.  For those who would care to have a copy, send a request to my off site email address.  The key requirement is to prohibit a check or draft accompanying an unsolicited written offer.  And in such cases to provide for a rescission period (sixty days).

The Sale of Mineral Rights by Mail Solicitation Act is designed to regulate certain transfers of mineral rights that place landowners and other persons with rights to minerals at risk of exploitation.  As defined in R.S. 9:2991.2, a sale of mineral rights by mail solicitation is the creation or transfer of a mineral servitude or mineral royalty, or contract preparatory to such a transfer, that is initiated by an offer transmitted through the mail by the transferee and accompanied by a form of payment,such as a check or draft.  An offer of this type may induce an owner to sell mineral rights without understanding the consequences of the transaction or at a price far below market value.  Because the doctrine of lesion does not apply to transfers of mineral rights,owners have relatively little protection under existing law.  This Part therefore permits a transferor of mineral rights in a sale of mineral rights by mail solicitation to rescind the transfer within sixty days of signing the act and requires that any transfer of mineral rights contracted in this manner contain a disclosure statement describing this right.  In addition, when the disclosure required by this Part is not included in the act of transfer instrument evidencing a sale of mineral rights by mail solicitation, the transferor has the right to rescind the contract for three years from the date of signing the act.  In such a case, the transferee is liable for attorney fees and court costs and may also be liable for additional damages at the discretion of the court.

 

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Permalink Reply by Oilman28 on March 23, 2016 at 11:46

So in a nutshell, mineral buyers can still send out offer letters in order to make contact about buying a persons minerals, but can't send any form of payment along with the offer?

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