Replies to This Discussion

Permalink Reply by Just want mine on June 8, 2012 at 4:23

Skip,

It's a tract of 80 acres to which I have 7 acres of it.  It's my 7 acres, minerals & all, it's just undivided.  I'm working on the homework end of it because I don't want to just sign for that little bonus money if in the long run production is made and the 1/8 royalty could have been better if I had negotiated better.  Everyone in the community has been contacted and signed by JB, which they got the same offer as far as the 300 an acre for years w/the option of a 2 year extension.  I'm not sure about the % on the royalty though.  Which I will be making a phone call or two to check on about that shortly.  I've also noticed the mention of a few lawyers that seem to be good, the only problem is I live at the opposite end of the state.  Sure wish I was back home for this.  But would feel more comfortable having an attorney look over all the fine print.  And I do mean fine print.  I don't think it could get any smaller!!

Thank you again for helping out!!

Permalink Reply by Skip Peel - Mineral Consultant on June 8, 2012 at 4:49

For 7 net mineral acres I suggest the following.  Go back to Page One of this discussion thread.  Review from Page One to Fifteen.  Make note of the offers from J B Land posted by other members.  Do not accept any offer of bonus or royalty less the best offer posted.  Now you know what to accept.  Wait for J B Land to contact you again.  In the meantime search the site for discussions on lease terms specifically Depth Clause.  You do not need a horizontal Pugh.  When you get the lease in writing tell them you would like have 48 hours to review it.  Then come back and ask any questions you may have.

Permalink Reply by HBP on June 8, 2012 at 5:52

The advice on the board has been great, especially for small acre owners where an attorney may not be cost effective.  I had one difference with an item above:

"You do not need a horizontal pugh". 

Perhaps I misunderstand the reasoning, but I attempt to include both pughs regardless of acreage size (depth pugh and what I call the "conventional pugh" since experts differ on how to apply the terms horizontal and vertical to pughs).  It may be unlikely that a conventional pugh is necessary, but most companies don't blink at it now, so I would put it in since we don't know the extent of what formations and what size corresponding units may be drilled under the lease in the long run.

Permalink Reply by Just want mine on June 8, 2012 at 6:44

Skip,

Thank you for that advice.  I plan on doing a little reading now, from 1-15.  

Thank you so much!!

Permalink Reply by Skip Peel - Mineral Consultant on June 8, 2012 at 6:07

Horizontal Pugh clauses are meant to keep a lease from holding any leased lands not in a producing well or unit at the expiration of the lease term.  Eighty acres all in the same section are not at great risk for this situation.  When a lease covers larger acreage especially when the lands lie in more than one section a horizontal Pugh is needed.  It has nothing to do with depth or formation.  It has to do with pooling.  Only those minerals being produced can be held by the lease.  At expiration the lessee must release the non-producing acreage.

Permalink Reply by HBP on June 8, 2012 at 10:13

I understand where you are coming from that this acreage may not be at great risk for the scenario.  But rather than worry about likelihood of needing the conventional pugh, I would just place it in the lease.  Since we cannot predict that all units will be re-tracements of sections, or even confined within section lines.

Permalink Reply by hazel c's grndter on June 12, 2012 at 10:39

My mother has gotten an offer about 3 weeks ago from a landman. her property is also TS23N, range 13W. She only owns 1/3 interest and the landman is having trouble finding other owners. He said she could lease her 1/3 percent without the other owners. Does anyone know if this is true?

Permalink Reply by Skip Peel - Mineral Consultant on June 12, 2012 at 10:58

Yes, owners of undivided interests may lease their share of the minerals regardless of the actions of the other owners.  However before you do so, do your homework.  Start by reading back through this entirre discussion from Page 1 to 15.

Permalink Reply by hazel c's grndter on June 12, 2012 at 11:00

Thank You. Will do.

Permalink Reply by inthestix on June 12, 2012 at 14:09

Skip, I can't find anyone west and north of Plain Dealing in T22 who has been approached about leasing. I did have another friend in T22 R11W that just got an offer in the mail with a draft. This way of leasing is a new one to me, I have gotten letters from companies wanting to buy my mineral interest that i have in a field in Texas but never a lease offer with a 30 day draft! This was also Merit who made the offer. It seems to me they are just leasing in an area where a 3D survey was done 2 yrs. ago and are leasing a mile or so buffer area east, south and west of the 25 square mile survey.

Permalink Reply by Skip Peel - Mineral Consultant on June 12, 2012 at 14:17

You'll find plenty filed in the Bossier Clerk of Court's records by J B Land.  Miller has yet to record any leases.  Bank drafts are not uncommon in acquiring leasehold.  There's no business reason to perform title research on minerals that are not under lease and a draft allows time to perform the research and void the draft should the title turn out to have problems.

Permalink Reply by inthestix on June 13, 2012 at 1:11

Skip, I was referring to Merit in the area west of PD in T22 and north of Hwy. 2.  I have been inquiring as to any landowners in that area that have been contacted to lease. Since no leases have been recorded at

all i have to rely on word of mouth.  So far everyone that has been approached or has leased has been in or around the 3D survey area i mentioned in earlier reply.

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