My interest is located: 

SECTION 13, TOWNSHIP 12 NORTH, RANGE 16 WEST - De Soto Parish, Louisiana.  A company has approached all the family members with interest in said property asking to purchase our mineral rights. I am considering selling some of my mineral rights, not all of the mineral rights.  My question is should I have an attorney review the contract?  Also do you have any "red flags" that I should look out for in the Purchase and Sale Agreement contract?  

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It is always a good idea to have an experienced O&G attorney review a purchase and sale agreement and a mineral deed.  It is also a good idea to get more than one offer to make sure that a seller isn't accepting less than the current fair market value.  Here are a few things to consider.  Section 13 has only one Haynesville well and has both proven Haynesville and Bossier shale reserves.  This means there are eleven wells to be drilled before the section is fully developed.  Comstock is in the process of drilling four of those wells which means a buyer would get a significant and quick return on their investment. Don't let a buyer rush your process of exploring the best price and then making sure you have professional legal assistance in the transaction.

Thank you for your quick reply.  I am currently receiving royalty payments from Comstock If I sell some of my mineral rights to this company that has contacted me, will I still have opportunity to benefit(continue to receive royalty payments from Comstock? The company rep that contacted me wanting to purchase my mineral rights stated that my present royalty payments from Comstock are from a Cotton Valley drilling, and will not be affected by selling them some of my mineral rights because of the depth clause included in the purchase agreement, which states:  Limited to the depths below the deepest producing depth of the Cotton Valley Formation to 100 feet below the deepest producing depths of the Haynesville Shale Formation. What do you think about this depth clause?

I would like to know the company making the offer....so I can avoid doing any business with them.  They are dishonest or incapable of performing basic research.  As to the Comstock royalties only coming from their CV production, ask them about this Haynesville well.

WELLS

SERIAL WELL NAME WELL NUM ORG ID FIELD PARISH PROD TYPE SEC TWN RGE EFFECTIVE DATE API NUM
243626 HA RA SU57;J D SAMPLE 13 H 001 C332 6156 16 20 013 12N 16W 11/01/2019 17031257970000

Here is the latest production for this well that Comstock reported to the state.

LEASE\UNIT\WELL PRODUCTION

RPT DATE LUW CODE STORAGE FAC DOC USE WELL CNT OPENING STK OIL PROD(BBL) GAS PROD(MCF) DISPOSITION CLOSING STK PARISH
12/01/2021 617270 1 0 0 8426 0 0 DE SOTO

Skip, Are you saying that it is probably not correct that my Comstock royalties are only coming from the CV production? 

Do you have a copy of your lease?  Unless it has a depth limitation clause, you are getting production from the CV and the Haynesville.  Look on your royalty statement.  Do you see the J D Sample 13H #1?  It would be a somewhat unusual case in 12N-16W to have a lease that didn't include the Haynesville (HA).

I reviewed the royalty statement and I see the Sample J D 13H 1 and Wilson ET AL 13 H #1.

Here is a cut-and-paste copy from the O&G database, SONRIS.  The J D Sample is a Haynesville Well (HA) drilled prior to the Wilson Etal 13 H which is a Cotton Valley well (CV).  If both appear on your statement, then your lease doesn't contain a depth limitation clause.  It is an "all depths" lease. 

Those last two wells, JM Pace 13-24-25 HC 1-Alt and JM Pace 13-24 HC 1-Alt are HA wells permitted but not yet drilling.  From a Section 12 surface location, there are two more wells permitted that will include your section 13.  The Fields 13-24-25 HC #1-Alt and Fields 13-24-25 HC #2-Alt.

Are you aware of these facts?

243626

HA RA SU57;J D SAMPLE 13 H

001

6156

C332

16

11466

16017

16050

1

617270

2

10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

246923

CV RA SUP;WILSON ETAL 13 H

001

6156

C332

16

10044

14091

14114

1

617713

2

10

253206

HA RA SU57;JM PACE 13-24-25 HC

001-ALT

6156

C332

16

28000

1

01

253207

HA RA SU57;JM PACE 13-24 HC

001-ALT

6156

C332

16

20000

1

01

253204

HA RA SU57;FIELDS 13-24-25 HC

001-ALT

6156

C332

16

28000

1

01

253205

HA RA SU57;FIELDS 13-24-25 HC

002-ALT

6156

C332

16

29000

1

01

Thank you for all the information you have provided. No, I was not aware of those facts.    

Gayila, I have no problem with someone who chooses to sell all or a portion of their minerals as long as they do their homework and get what I consider a fair market price.  Each mineral interest is different and unique.  Yours just happens to have CV, Bossier and Haynesville reserves with four new wells on the way.  A buyer should pay a premium for any of your minerals you choose to sell.  The company making the offer has already caused me to distrust them as they were not truthful with you.

This was a phone call from a MESA representative and I laughed at them.  The rep started telling me how much more I could make if I took their money and put it into a fund rather than minerals.  I told them they should do that and forget my number.  

LOL!  Good response.  I find that a lot of these really big dollar offer letters are coming from companies new to the Louisiana Haynesville.  Many have been active in Texas particularly the Permian Basin.  Now that natural gas is in vogue again and mcf prices have spiked, they are attempting to acquire some Haynesville mineral rights.  Seller beware.  Many of these companies have no experience with Louisiana's unique mineral codes and regulatory requirements. 

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