Replies to This Discussion

landownerPermalink Reply by FXEF on August 20, 2011 at 12:33

Ken,

The bonus should be paid upon signing the lease. You want a check, not a bank draft. They may never drill and therefore no royalty check.

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landownerPermalink Reply by Ken Boone on August 20, 2011 at 14:22

Are there any instances where bonuses are not paid upon signing a lease.

Is the lease signed before drilling occurs?

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landownerPermalink Reply by obed w odom on August 20, 2011 at 16:21

Yes, I think there are cases where one mineral owner may have "executive" rights, that is, the rights to lease and receive the bonus, while another mineral owner (nonparticipating?) may only receive royalties. This would be, I think, spelled out in legal documents pertaining to the mineral rights in question. The lease would still be signed before drilling occurs unless the owner with executive rights chose the "unleased mineral owner" option.

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landownerPermalink Reply by Henry on August 21, 2011 at 0:13

Ken,

Drilling can occur before the lease is signed.  If an operator has a large fraction of the section leased, he might begin drilling before getting the last few mineral owners signed up.  Ususally the last few who are not signed will have a bit more leverage for favorable lease terms. 

 

And....  if you are a regular landowner (i.e., not someone with a gazillion acres), there is no reason to do anything unusual in signing a lease.  You should receive your bonus money at the time you sign.  And, as FXEF says, do your best to have the company give you a check, not a bank draft. 

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landownerPermalink Reply by Ken Boone on August 21, 2011 at 1:08

Thank you all for all of your advice.

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