Since mid August My family and I have been receiving numerous calls from Landmen interested in buying our mineral interest primarily in Bossier and Bienville Parishes. The offers have continued to increase and about the same time Hurricane Laura struck Lake Charles the offers increased to a level I could not ignore.
Atomic was one of the companies and presented their offers in my preferred form of Price per net mineral acre in writing in a very straightforward format. On a follow up call when I told them my fed ex package containing the offer had not arrived they emailed it to me for review. With the hurricane I did not have internet for my computer and could only retrieve and read my emails on my phone.
The other company representative, Michael Heldoorn with Springbok Royalty Partners, LLC indicated his company could beat Atomic’s offer and assured me his company had the money readily available so I could rest assured the deal would go through without any hiccups because they were the end buyer. Then he asked what it would take to get me and my family to sell Springbok Royalty Partners, LLC all or a part of our minerals in Bossier and Bienville Parishes in their chosen sections. I told him we already had an offer in writing that was the same per net mineral acre regardless of the royalty burden and he said not a problem, they could beat that offer and for me to come up with a number. After thinking about it overnight I came up with a price per net mineral for the part with the 25% royalty burden about 20% higher than the Price per net mineral acre for the potion with the 3/16th royalty burden. Michael Heldoorn said he was not going to over inflate the price of the section at 25% to give me what I was looking for on the section with the 3/16th
Royalty and that he would give me the price I had quoted him on the Section with the 3/16th burden for all of it. I told him at that price I felt my sisters as well as several cousins would agree to sell. It was agreed I would call them since in his words they would be a lot more comfortable if it came from me than from someone they barely knew if at all. I too agreed because that way I knew they would be receiving the same offer.
After having talked to Michael for 3wks or so and with all the distractions with the hurricanes I let Michael Heldoorn and Springbok Royalty Partners, LLC prepare the Purchase agreement fully expecting them to send out that agreement reflecting the terms to which we had agreed to my sisters and several of my cousins.
Michael made sure to emphasize to those signing the agreement that it was the deal I made even when asked specifically if it was the net mineral acre price we had agreed to. Each time he assured the individuals it was the deal I made. He made sure I received mine after everyone else had signed and again I only had my phone on which to review the document. When I questioned the dollar amount being a lot lower than it should be Michael blamed it on my decimal interest and that they couldn’t pay me for minerals they could not verify. I knew a few months earlier I did have a problem with my decimal interest in one of the sections so I thought it would all come out in the wash in the end. At this point I was unaware others had seen discrepancies in the dollar amounts they were to receive but the decimal interest they were selling was correct and they were being strongly encouraged to sign based on the fact it was the deal I made and to sign immediately or the offer would no longer be valid at the end of the day.
The next day I was approached by another family member asking me to verify his offer was indeed the deal I made with a Michael Heldoorn for our mineral interest in one of the two sections in which I sold. It was when I decided his net mineral acres into the purchase price that I realized his offer was in fact much lower than the deal I made with Michael Heldoorn for our minerals in that section.
I then contacted another cousin who had sold only in the other of the two sections involved and realized his paperwork did not represent the deal I made with Michael Heldoorn per net mineral acre for that section.
I continued to contact others involved and realized all of our purchase agreements reflected terms per net mineral acre much lower than I had negotiated. All were represented to these individuals as the deal I made.
So, BEWARE when signing your purchase agreements and always have a good oil and gas attorney review them before you sign to make sure the agreement you sign represents the intent you understood and is representative of the deal you made.
When things are not handled in fair and honest manner remember the American Association of Petroleum Landmen has a code of ethics and follow through by reporting these incidents.
I am just sorry I allowed myself to be manipulated by Michael Heldoorn and Springbok Royalty Partners, LLC and wish I had given Atomic more consideration.
My apologies for the length of my comment but It is important to me to try and prevent this from happening to anyone else.

Views: 1136

Reply to This

Replies to This Discussion

Many mineral buyers are the scum of the Earth, in my opinion. Most of them are not real landmen and don't follow any rules of the AAPL. They have the same ethics as a cheap fly by night used car salesman.

I have been approached by a number of companies wanting to buy some or all of my royalties.  I only had extended discussions with one company, Live Oak, in Houston, and found them to be very up and up.  Our family chose to not sale any of our royalties, but I'm just trying to say that all of the companies buying minerals or royalties aren't bad.

It saddens me to read about your situation, Jane.

And this points up the importance of using the services of an experienced oil and gas legal firm to negotiate any contracts and offers. The attorney would have caught that decimal interest discrepancy and saved you and your family money, time and anxiety. 

Plus, if your royalties are potentially substantial, and/or come from multiple wells, a good forensic CPA who will audit production would be extra protection. They can ensure that the operator pays the decimal interest you are owed and keep the operator's fees/charges in line with your leases. 

RSS

© 2020   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service