landowner

Selling Royalty - not minerals

I have contacted some companies about purchasing my royalty interest in one specific well - not the minerals or subsequent wells.  What pitfalls should I be aware of?  Thanks.

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Oil & Gas ProPermalink Reply by The_Baron on December 9, 2011 at 5:05

Just be sure the deed is clear.

 

Make sure it refrences the well by name and serial # to avoid any confusion. specifically exclude any future wells, including any alternate unit wells. You may want to specify a term, maybe stating that all rights revert should the well ever be P&A. You never know the well could be rentered twenty years after the P&A.

 

Make sure that the amount of royalty is clear... if you don't understand it ask. If your interest is large enough to justify the cost, get a lawyer


landownerPermalink Reply by Headly on December 9, 2011 at 9:32

Thanks TB.  Such helpful infor. Remind me what P&A is.  I'm still bargaining on a price.  They started at about 100% of the first years payout.


landownerPermalink Reply by Henry on December 10, 2011 at 2:03

P&A is "Plugged and Abandoned."

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