Replies to This Discussion

Permalink Reply by jffree1 on August 21, 2013 at 12:28

It was an extremely well written post, GoshDarn, except for the part where he warned that our motives for offering our advice might be 'suspect'. I was offended. He very clearly is educated but he isn't informed... re: said motives. And casting a shadow on our advice might be considered self-serving if he was the one who sent out said lease. Don't you think?

You know I respect your opinion and I am not trying to start a spat with Jeff. It just sort of set wrong, what he said about our motives. That's all.

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Permalink Reply by GoshDarn on August 21, 2013 at 13:05

jffree:

True.  I understand your thinking.  Good point.

And we all know that your intent on GHS has always been quite sterling, in that you have selflessly helped hundreds of landowners (if not more) with your free advice.

I've never known anyone to complain about your spot-on insight.  In fact, you're the go-to member for (and the protector of) when it comes to TX minerals.

Methinks Jeff is new, even though he might've been lurking for a bit.

As always, jeffree, I have the greatest respect for your insight and thinking.  If asked, I would tell anyone that I do, indeed, trust you.

Thanks for taking all the time you have over all these many years to share your solid knowledge.   

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Permalink Reply by Jeff on August 21, 2013 at 12:53

Thanks, personally I just want to see the price of gas go up or the government start allowing us to export our gas internationally or maybe instead of spending money on companies like Solyndra, invest in another pipeline or in communities whose municipalities make use of the gas by powering buses, construction equipment, garbage trucks, etc.  I would like to see there be more competition in the market, that is better for the little guy and better for country.  I'd like to get rid of the utility companies being allowed to charge whatever they like independent of the price of gas.  Let's let the market work for a change and quit trying to rig the system for the people that need it the least.

But I digress, this isn't about me or jffree or SB (can only your friends call you SB?) or adubu, this is supposed to be about Sherri.

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Permalink Reply by adubu on August 21, 2013 at 15:24

Jeff --- lots of good discussion about LNG through out this site which I agree would help increase demand but the USA can produce easy what can be exported . There is about 10-12 BCFD export site approved permits but will take until 2018-20 before construction completed this would increase demand about 15% to about 83 Bcfd presently demand about 71 Bcfd which is what produced and excess place in storage. This could return some drilling in dry gas fields like HS and who know what prices will be but most likely be in $6 range out 2020-30 which will make it profitable IMO but who knows It will never be a world market like Oil. The question about Spring Branch called SB that just a lot of people just type out initial for easier

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Permalink Reply by Jeff on August 21, 2013 at 12:34

jffree1 - whoa, whoa there.  Not trying to start a flame war here.  I know that you guys are active on the boards.  I never leapt to any conclusions about what your motives might be, but you make my point for me.  For all Sherri knows you could be the one sending out the leases or I could be or Spring Branch could be.  Or we could be a mineral company buying up minerals and trying to keep her from leasing so we can collect on the bonus.  Or we could be landowners, or we could be independent landmen.  Or we could be...  well you get my point.  I don't know what your motives are but do you trust the guy on the internet that says "trust me?"

You make another good point, there are no more than a handful of people left on this forum talking about the Haynesville Shale.  You mention that you have "only seen a handful of people ... since 2008."  Well, Sherri may take that to mean that the 2008 Haynesville is the same as the 2013 Haynesville, which by the dwindling interest that you mentioned, it would appear not to be.  If Sherri took what you said to mean that she should wait for 2008 or 2011 money/offers to come along, she would never get paid any bonus.  That could potentially be misleading and to her detriment.  I did not say you did it with ill intent, on purpose, or that she was misled by it and I didn't ever question your or anyone else's integrity.

When Adubu says that the landman will "let it set for in few months he will call you back if they get most of unit they want leased," that is misleading.  There is no reason to believe that the landman will ever call back once they get most of the unit leased.  I learned the hard way that the gas company is under no obligation to lease me after they made a good faith effort the first time.  A unit gets formed, I get left out and with my small interest there is no reason for them to come back to the table.  I end up having to pursue the producer and that is not bargaining from a position of strength, let me tell you.

Spring Branch made a simple math error is all, when it took the bonus offer as per acre instead of flat, which Adubu was quick to correct and Spring Branch just as quick to acknowledge.

I did notice that you didn't disagree with anything that I wrote, however.

Good luck Sherri!

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Permalink Reply by jffree1 on August 21, 2013 at 13:33

No, I didn't disagree with what you said. Most owners, of undivided interests, were/still are unaware that they do not have any leverage, or very little, when is comes to negotiating a lease in Texas. They can be cut out, via SWR 37 exception, and not get anything by trying to play hardball.

At the same time, I would never take the first offer laid on the table without asking a few questions and at least exploring whether there was a chance at a better royalty. Nothing ventured... nothing gained. But I would never advise someone to hold out to the bitter end. That is just foolish.

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Permalink Reply by Two Dogs, Pirate on August 21, 2013 at 14:20

I will always think of you as the "GO TO PERSON OF TEXAS", J. Thanks for all your help over the past several years. You are the "GO TO PERSON OF TEXAS".

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Permalink Reply by jffree1 on August 21, 2013 at 15:38

Thanks, you two. I appreciate your confidence in me.

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Permalink Reply by adubu on August 21, 2013 at 16:01

Jffree1---I also agree with Mike and 2dogs

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Permalink Reply by adubu on August 21, 2013 at 14:46

Jeff-- your post is very well written and very informative. You may be absolutely correct with what I said for the landman may not call you back but I know the operator likes to have all titles cured in the unit and all leased especially small undivided interest if in drill site it's less of a accounting headacre but if any minerals leased they can just take em and not pay you anything i believe in Texas but i m not attorney to verifiy that statement and maybe you correct "bird in hand better than two in bush" I agree with jffree1 take best you can get and take a lease Sherrie for best to lease even if small < one acre net --enough for Dinner out with your "special person" in your life -- so I too wish Sherrie good luck -- and Jeff stay around and welcome to GHS for I learn something every time I look on this site. I did have a small interest of 0.5 acres in unit that was about 38 years old and I had landsman call me since a new well include me in drill site I took flat $100 and 20% R it was a old unitize unit about 3,000 acres NE Shelby in Joaquin field( they found me after all those years)this was about 7 years ago before the HS gold land rush

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Permalink Reply by Spring Branch,mineral owner on August 23, 2013 at 6:01

Good luck, Sherri.  My opinion (since you asked for it) is that 3/16 is a lousy offer----period.  Would I take the offer if all discussions  for 1/5th or better failed-------probably.  However, be aware that when the Operator gets through with all the gathering, transportation, etc , charges, your net will be less that 1/6th.

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Permalink Reply by adubu on August 23, 2013 at 6:32

sherrie-- the point SB talking about are deduction out of royalty check paid to treat gas and transport it to sell point is like about 2-3% royalty in value money you receive i.e. 3/16= 18.75% R -deductions (estimate avg) - 2% = 16.75% which is 1/6 net basically so you should request Royalty Free clause in lease so you do not have any deductions which they may agree to on small net minerals and then take the 20% if that's all they will agree on.( be like a 22 1/2 % R without R Free Clause. You sure can ask plus also depth clause in lease. Otherwise with small < 1 acre using operators standard lease 88 form would be ok for me. I would not push anything else and get a lease signed and go on with Life

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