I would appreciate any information regarding the Shut-in Rental clause in a lease we have been offered. Can anyone give me an idea of the going rate per net mineral acre per year? Thank you. Sandra

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Most companies wouldn't agree to that change. It doesn't hurt to ask. You could also ask for 50% royalty.

Thank you for your information.

Sandra

sandra,

Yes, they can drill in your section, even if you aren't leased.  Go read the group on Unleased MIneral Owners.  This is not for the weak and timid.

I won't tell you what or what not to do here.  You need to decide if this is a deal breaker for you.  Maybe you can go back to the landman, explain your concerns some more, and see of you can come up with some type of agreeable language.  Maybe you can somehow compromise -- maybe something like any three periods longer than 8 months, or some such thing would be a reason to kill the lease.  But then, ask yourself, what would happen if they ended your lease, but kept on drilling?  I don't really know.  

Let's hope some others, who have more experience, will chime in here.

Sandra,

  As Two Dogs stated above you could ask for 50%.  You could ask for the moon. 

  I think the most important thing you need to ask yourself is "do you want a lease".  Do you want the company to drill?  I firmly believe in protecting yourself and getting the best lease possible, but do you want to lose the lease entirely?

  Davidson, Jones and Summers is one of the most knowledgeable firms that you could have chosen and one of the most honest.  They are landowner focused.

  It is ultimately up to you to decide which details are important to you.

  Good luck with everything.

I only raised the cumulative thing because my relative has a lease that is almost 50 years old.  She gets $20/year out of the lease, and the company periodically shuts the well in and goes away.  Then they come back and run the well for a while.  It just doesn't seem right that this is a way to hold acreage.

Henry how many acres does your relative own?

TD,

My relative owns more than enough that $20/year is a pittance.  In the "good old days," when this field was more active, my relative was getting hundreds of dollars per month.

Sandra,

I would consider Davidson, Jones & Summers to be among the very best law firms to represent mineral owners, so you may bring this issue back up with the attorney you spoke with before. He would likely have a better appreciation of your bargaining position, who the potential lessee is, and how important the shut-in clause will be to you than the collective wisdom of this board (which has some considerable wisdom, but is probably not the best place for you to thoroughly detail you particular situation).

Thank you for your reply and the information. I have learned so much for everyone here.

Thank you to everyone who posted information about my shut-in clause question. It is nice to hear everyone's suggestions and ideas. I really appreciate all of the replies and this site overall. I am still torn about what to do but at least I have information which I did not have before. Thanks so much to everyone. Sandra

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