Replies to This Discussion

Permalink Reply by Charmine on August 12, 2008 at 8:57

We were offered $3500 with 1/4 royalties for 3 years, with a 2 year option. This is within the last 3 weeks, just north of Center. The landman is telling me to give him a number to run past his superiors, if we have a different number in mind. How do I determine a "good" number, so they don't just laugh at us? He also said that the original $3500 for the 2 year option could be changed to $5000 for the additional years. He is also saying that it can be written into the contract that we are free to re-lease out any acres that don't get put into a unit. I believe he said this was a Pugh clause. I need to go reread definition, because something about that last bit doesn't sound roight?

Permalink Reply by intrepid on August 12, 2008 at 16:59

How is it possible that the company putting the unit together could not guarantee a landowner that their land will be in the pooled unit?

Permalink Reply by Charmine on August 13, 2008 at 13:20

Have I understood this wrong? The landman said that there was no guarantee of being put in a unit, nor of the unit being drilled. The way I understand it is this, I can sign a lease for my 4+ acres, but that would mean he still needs to find another 636 acres to form a unit. If there are a whole bunch of us in an area with 4 acres, it could take awhile to get all of us signed to form a unit, especially if there are hold outs involved. I am GUESSING here, but I think the o/g companies would really prefer to deal with as few of owners as possible, who own a lot of acres. I'm sure it is less hassle, and more cost effective on their end of the stick=less landman time and money, less mineral owner time and money.

Permalink Reply by Sarah on August 13, 2008 at 4:08

Thank you Jim McConnell for warning Charmine she is about to lose money!!! Thank you for your input!

Permalink Reply by Charmine on August 13, 2008 at 11:58

Thank you for the insight Jim, though this is an OFFER only, not signing anything till the numbers come up and I understand this better. By the way...how am I losing money if I never knew I owned mineral rights in the first place? All I want for myself is the going rate, and fair lease terms...how can I be greedy with "found" money? Last I checked we were all on here to help ourselves and each other...it might be more helpful to explain to us newbies WHY we are about to lose some money if you want to share your knowledge-please and thank you!

Permalink Reply by Charmine on August 13, 2008 at 13:35

LOL, I don't doubt one bit of what you are saying! I was never good at trying to bargain with someone over a sale. Hence I sit, watch, wait and learn till I feel like I've found the sweet spot that I can be happy with for years to come. My concern is will I know it when it comes to me? I'm open to suggestions!

Permalink Reply by Sarah on August 13, 2008 at 17:10

Don't feel bad, I feel like one big dumb bunny on here myself, Charmine. Notice I didn't say too? We just can't be expected to know these things when this has NOT been our field. That is why we hope, watch, sit, wait, to learn what Jim McConnell means by missing the cues. Maybe he'll cue us in a little on where to learn this negotiating language.
I didn't even know I had mineral rights either until these land men started calling me. I don't think Jim was implying at all that you were being greedy, (you are not)... he was just trying to keep you from losing money.

Permalink Reply by intrepid on August 13, 2008 at 15:06

Have you checked the Texas Land and Mineral Owners Assoc. website and read the papers they have posted there about negotitating an Oil & Gas lease? There are several papers there that are very helpful.

Permalink Reply by Sarah on August 13, 2008 at 17:14

Thanks Intrepid, for telling us about those papers. I'm sure they will help us bone up on our negotiating skills.

Permalink Reply by Mint Julep on August 13, 2008 at 7:31

I would like to know what land is going for in the area in between Joaquin and Center, if anyone knows?

Permalink Reply by Charlotte Holt on August 13, 2008 at 8:17

Contact Jerry Nutt at 936-591-2753 He is from Center. He is working with several different companies putting together the best deals.

Permalink Reply by Professor Fred on August 13, 2008 at 17:25

What is Mr. Nutt qualifications to negotiate with O&G companies? Does he own property in Shelby County? What companies is he negotiating with? How many landowners is he representing?

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