Replies to This Discussion

Permalink Reply by king john on October 14, 2009 at 23:09

http://www.gohaynesvilleshale.com/forum/topics/any-umis-out-there-w...
a few comments from "j" on timber theft...
kj

Permalink Reply by ELLIS HUGH on October 13, 2009 at 14:48

Simply, we are not paid to look out for your best interests. Our client pays us, (typically very decently), to make the best deal possible for them. It's simple ethics, you don't bite the hand that feeds you. They pay us to look out for them, and that's what we do.

J, Keep in mind that Skip Peel is an independent landman (site sponsor) that provides services for mineral and royalty owners. He represents lessors and has their best interest in mind.

Landmen that represent E&P companies will protect the interest of their clients.

I think you will have to agree to disagree on the standard HS royalty issue.

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Permalink Reply by jeff on October 13, 2009 at 13:32

"Simply, we are not paid to look out for your best interests. Our client pays us, (typically very decently), to make the best deal possible for them. It's simple ethics, you don't bite the hand that feeds you. They pay us to look out for them, and that's what we do."

I have been a landman for over 30 years and my father was a landman for almost 50 years. I do agree with the above statement, however, I remember something my father told me when I first started in the business. "Clients will come and go, but the landowners usually stay the same. Over the years, you will have to go back to the same land owners or their families/friends so you better treat them like you will do business with them again, because you will"

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Permalink Reply by Catfish on October 14, 2009 at 1:41

Jeff, your father gave you good advice!

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Permalink Reply by Randy on October 14, 2009 at 3:58

I agree with that as well. The advice I got was "never lie".

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Permalink Reply by RBH on October 14, 2009 at 14:29

right ON!! good for you...wish yours was the prevailing attitude

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Permalink Reply by Randy on October 15, 2009 at 16:08

I think it is the prevailing attitude really. Bad apples get more press than the good ones.

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Permalink Reply by RBH on October 13, 2009 at 18:31

seen where broker groups get an orri assignment on leases they have taken and reserve an orri when assign to company they are leasing for

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Permalink Reply by intrepid on October 19, 2009 at 17:46

They get to keep their jobs?

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Permalink Reply by David on October 20, 2009 at 5:59

PG-

What I am saying is not that I have vast experience because I have had minerals leased for decades. What I am saying is I cannot recall a single landman that tried to take advantage of us. A good part of that is we work through an attorney, who sees any and all offers, either first or we send them to him for his review. If there is something we/he disagree with or dislike, such as the lease rate or royalty, etc., then the offer goes back to the company making the offer.

Leasing your land or mineral rights is no different than any other major decision: get a professional - in this case, an O&G attorney - to look over offers. We are now in the 4th generation of owners. Ask any landman how difficult it is to get in touch with close to a hundred owners... it is like trying to herd cats. When our attorney looks it over and says it is a go, we go. I imagine the landmen actually prefer this rather than oppose it, as the heirs are scattered across the US.

Comparing leasing now with leasing of 2-3 years ago is unfair. No one expected the volumes and production numbers we are seeing. And I can assure you that once the news began to get out about the HS, our attorney immediately looked at leasing offers from O&G companies much, much more closely.

I think you put far too much emphasis on what a landman should do for you or me when, in fact, we are not his client. If, for example, any of the landmen on GHS were to recommend that you or I not take an offer from the company he was representing because he thought it wasn't enough/fair/whatever, and we subsequently never got the land leased, who would we blame? The landman.

"Landmen can do anything they want."

Sure, if they do not care about staying in a job. Or civil litigation, I would suspect. Quite honestly, I do not understand your antipathy towards landmen. If they were all scumbags, no one would deal with them.

Any landmen on here please correct me if I am wrong on this statement, but aren't landmen basically the messenger who delivers the offer to the landowner from the O&G company? I do not mean to denigrate your job by any means, but aren't you basically hired to find the owners, explain the offer to them and then they make a decision, with or without their advisors?

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Permalink Reply by ELLIS HUGH on October 20, 2009 at 7:05

David,

You are correct, see my response on page 3.

The majority of 'leasing agents' simply deliver the offer provided by their client. Any counter-offers are sent to the client for approval. Some brokers may have some authority to alter the original offer, but very rarely will a leasing agent have any authority to change the terms of a lease offer.

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Permalink Reply by David on October 20, 2009 at 7:49

Ellis,

I have had some dealings with landmen who were had no discretionary authority and those who did. Either way, the responsibility is on me or my legal representative to accept, reject or suggest a modification.

Honestly, it has been quite a long time since something did not go by our attorney before we ever heard of it. And we only heard of it because our attorney had already reviewed it and we got a letter from him to that effect. It actually sped up the process - sometimes a good bit - by having all offers first go by him.

If I had any advice for people considering leasing, it would be to get a good O&G attorney - and I would get referrals before selecting one - and let them do their job. Will it cost money? Sure. But it may be the case that the attorney, like ours, more than pays for his fees. For example, we are often getting 27.5% royalty - after payout - bumped from an original 25% royalty.

The 2.5% may not seem like much, but over the course of a year it can be equivalent to getting an "extra" month of royalty income. And over the course of years could prove to be a substantial difference.

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