Replies to This Discussion

Permalink Reply by Joe Aldridge on October 25, 2013 at 9:18

My problem is: I don't trust one person's opinion or knowledge be it an attorney or whoever.

On the other hand, I really appreciate GHS. Keith has done a wonderful job of creating a site that allows people to exchange knowledge and ideas. And those are the things that can make a difference in a deal for a lease or for the use of the surface or whatever.

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Permalink Reply by Keith Mauck (Site Publisher) on October 31, 2013 at 3:54

In my experience, an attorney (or pick any professional service) has often proven to be only as helpful as I am vigilant. For me, I am going into an attorney office, but only after I have a firm grasp of the situation.

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Permalink Reply by Joe Aldridge on October 25, 2013 at 10:12

Cindy,

I would really like to know how this works out for you. Just keep in mind what tc said. They may end up going to a neighbor and cutting a deal with them. It really depends to some extent whether you want to deal with them or not and how badly they need your property. If a deal appears to be getting to a final stage I would suggest you see an attorney about the specifics.

If you want to share the info of your deal privately then "friend me" and we'll email rather than post. I do this with a number of people on GHS that don't want specifics posted. Good Luck, I hope this works out to all of your benefits.

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Permalink Reply by dan harrington, jr on October 28, 2013 at 10:29

If it were me, I'd get the property appraised, then sell it to them - and in a separate agreement, try to work in an override on the adjoining property if they drill it from the same 6 acres (I'm assuming you don't live next door to it).

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Permalink Reply by Joe Aldridge on October 28, 2013 at 11:03

NO, NO, NO, NEVER SELL!!!!!!!! Sign a long term Commercial/Industrial lease with them. When Amoco needed 20 acres for a sweeting plant 35 years ago the land owner negotiated a lease at the rate of $1,000 per acre per month. That lease is still in effect. Add it up. They could have never gotten that kind of money in a sale. Also, as I said earlier in this thread the property tax will go up to the sale price on the remaining property that the land owner retains. The retained property will be classified as investment,commercial/industrial.

Also, in the lease make sure the lease is net, net, net. In that case EXCO will have all responsibility for improvements, damage, restoration and property tax in addition to the rent/lease amount paid per month/year or whatever.

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Permalink Reply by P.G. on October 29, 2013 at 3:07

I wonder how much they pay for their lease for their office?

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Permalink Reply by JHH on November 3, 2013 at 17:00

If you sign a long-term commercial/industrial lease... wouldn't you have to pay income tax on that... state and federal?  just wondering.

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Permalink Reply by Joe Aldridge on November 5, 2013 at 15:34

Yes you would have to pay Income Tax on the amount received on the Lease of the property. It would be ordinary income and would be taxed at whatever rate you are taxed at.

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Permalink Reply by dan harrington, jr on October 29, 2013 at 10:33

There's no right or wrong way to handle this. The primary object is to get a good well under your 40 acres; anything else is gravy.  Attorneys, consultants, etc. can cost you a lot of money up front; I advise limiting that expense.   Most people like a deal that they don't have to worry about in the future, that's why I like selling unless you're "married" to the property.   You're in a good situation no matter what you decide.

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Permalink Reply by dominator on October 31, 2013 at 8:26

we have 1,000 acres off of Friendship road in Frierson, I would just like to say, their is so much ambiguity right now, as we have a "MADMAN" behind the controld at 1600 Pennsylvania, none of this may matter if he keeps conducting activities designed to destroy this nation,Never before have we faced the type of uncertainty that is Gripping this co0untry as we speak, Ever since day one, this IMPOSTER has engaged in a carefully orchestrated manner of dismantling this nation, and he has done a tremendous job of pounding the nail into the US"s coffin, we have a real-life MONSTER in DC. this Halloween, and as each year goes by, he is getting worse and mutilating our economy further And further beyond repair.

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Permalink Reply by Gordon Peppard on November 4, 2013 at 9:57

In Texas, specifically, Barnett Shale in Tarrant County pad drilling, you should ask for an overriding interest in EVERY well drilled from the pad, regardless if you own the mineral rights or not. The override is carved out of the working interest. Make sure it is an ORRI. You can have a RI & ORRI in your mineral lease and an ORRI in every other lease well without a RI.

You are accommodating the operator if you let them use your land, plus they sought you out because it is a viable option for them. In other words, they want your acreage. You have the leverage if they are serious. You might be surprised what you can get, 1% or more.

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Permalink Reply by Skip Peel - Mineral Consultant on November 4, 2013 at 10:45

I don't think that the ORRI request would be well received by either the operator or the mineral interests in the unit.  Where a well pad is located on unleased lands in Louisiana (Haynesville Shale Basin particularly)  beyond compensation for use of the surface, landowners have negotiated "sub-surface easements".  The easement is paid by the operator so there is no fuss over royalty monies.  And the easement terms can vary by size and/or number of well bores that penetrate it.  An experienced O&G attorney who understands the basics of horizontal drilling should be able to put together the specifics in such a way as to satisfy the operator and the landowner.

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