Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on November 14, 2008 at 14:14

KB. I thought you might catch that. Actually the scam mentioned is kind of old news. I hope that the assertion that it has been stopped is correct but the lack of interest in investigating any other mineral related questions is disturbing.

Permalink Reply by Antsu-in-Japan on November 15, 2008 at 6:13

This is EXACTLY how my father was first approached about his land. They can add our family down as one of those cases.

Permalink Reply by The_Baron on November 17, 2008 at 10:07

I don't think all offers to buy minerals should be regarded as fraud.

Many people sell minerals or royalties as a way of getting cash now rather than later. Granted the potential of the HA has increased the value of minerals in the so called core area, at least within the gorilla uplift, but an offer to buy minerals and royalties is a legitmate investment. Like any transaction each individual should weigh the pros and cons.

Offers will be below the potential value. This is how mineral buyers make money. A large upfront investment that will hopfully pay off over time. In LA, prescription should result in lower values for minerals than a state like TX, where the transaction is forever.

That being said, I do believe that there are those out there that have conducted themselves in a discraceful manner. These people should be punished accordinly.

Permalink Reply by BirdDawg, plain ole' idiot on November 17, 2008 at 10:30

Has anyone had mail offers from "Cobra Petroleum Company" , P. O. Box 136355, Fort Worth, Texas, ph. 817-237-5440, www.cobrapetroleum.com?
They send you a $250 draft and agreement to purchase your minerals. They say they will pay like 30 times your average last six months average income. Then you read the small print, and they have terminology that states you are conveying ALL mineral interest you have "within the lateral boundaries of the property referenced on said deed and includes all of the mineral ond royalty interest (without limitation) you own in said parish", not just what may be obviously listed. And the kicker also is, if you have no current income from the royalty interest, they get any and all of your mineral interest in the referenced parish for the $250. Now that is what I call a scam. I keep thinking that the AG will put them out of business in Louisiana, but I gave gotten them for about the past 3 years. The latest one was 2 weeks ago. I really think they should be made to cease operations in Louisiana.

Permalink Reply by The_Baron on November 17, 2008 at 10:37

I agree that this is a scam. It doesn't matter if the AG put them out of buisness or not the damge is done. I would not sign a mineral deed that does not clearly state the property involved. I also would not sign a mineral deed unless it stated that the vendee has not surface rights.

Permalink Reply by Bobi Carr ("parker") on November 17, 2008 at 14:12

BirdDawg,

I agree it is reprehensible, but there is no "lession beyond moiety" for mineral rights.

Permalink Reply by BirdDawg, plain ole' idiot on November 17, 2008 at 14:27

Parker,
No doubt about that. I never implied that there would be recourse related to lession regarding sales by most methods. I am simply wondering how many cases have there been of people selling to "Cobra" and not realizing what they have done. But I will say, anyone who sold to "Cobra" under the deed I had sent to me, would have recourse. And not by lession beyond moity, but due to out and out fraud. If you saw the papers I have you would understand. No sour grapes on my part, I sold nothing. But I wonder who may have. This would not be a leasion case, a pure case of fraud.

Permalink Reply by BirdDawg, plain ole' idiot on November 17, 2008 at 15:27

KB and JK,
Exactly

Permalink Reply by HBP on November 17, 2008 at 15:28

Yes. People have made royalty offers to you over the last many years prior to 2008, but again, I don't think its because they were twisting their mustache waiting to get to your Haynesville shale interests. The offers prior to 2008 were most likely for Hosston or Cotton Valley production. Trust me, if a royalty buyer knew the potential of the Haynesville reserves prior to the announcement, then they would be doing alot more than shooting off form letters through direct mail.
Most of the people that send those letters (including Permian basin) use a shotgun effect and just send them wherever there is proven production or where areas have been unitized. Now Cobra is a bit different on approach. They are a little lower on the food chain and their direct mail offer is not the best deal.

But all in all, treat it for what it is - an offer - then accept or decline based on your specific situation. I get offers for credit cards, lines of credit, etc... each week but I don't cry fraud. They send me checks that appear to be made out to me, and all kinds of 0% "deals" with the fine print in a light gray color on the back (barely readable). But its not fraud, just an offer. And you would be throwing the baby out with the bath water to condemn all royalty offers because I know many owners who have made great deals that they came out way ahead on - especially in Louisiana where the minerals revert to the surface owner w/o production, which places more risk on the royalty buyer. In other states, you purchase minerals, you keep them in perpetuity.

Permalink Reply by BirdDawg, plain ole' idiot on November 17, 2008 at 16:17

HBP,
I am referring to the Cobra offer as I got it, and no other. And it was fraudulous and deceptive. Period. I have no problem with anyone accepting an offer made in good faith. This does no apply to what I am talking about. Free market my ass.
Pure and simple deception and fraud.
Please, don't respond to this, I would really rather drop it. If you will. Thanks.

Permalink Reply by BirdDawg, plain ole' idiot on November 17, 2008 at 16:02

HBP,
I started getting offers from Cobra prior to anyone knowing about the HS. That is not the issue I am referring to. So much for the "mustache twisting". And my last offer was 12 days ago. So they knew about the Haynesville Shale, and they continue to shoot out the mass mailings. And my post was regarding ONLY COBRA OFFERS. Please don't read anything else into it. And I understand it was - an offer-. I am only worried about people that didn't (or couldn't) read the small print. I am sure you are a good guy, but don't defend Cobra, or anyone like them to me. I fully understand the legal implications of anything like this. And I will fight them, or anyone who defends them, to the end.

Permalink Reply by HBP on November 17, 2008 at 16:18

I am not defending cobra. My posts make that clear. But beyond Cobra, lets talk about specifically what is in these offers (other than Cobra) that we find fraudulent. Lets talk specifics. What do they say? I want to know if there are some questionable practices going on lately.

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