I received a letter from Red Oak (apparently associated with Primrose South LLC in some way). I have been told both are new to this area.
They asked me to contact them if I was interested in a lease. They gave no real information.
Have any of you heard of these companies or know anything about them leasing in this area?
Thanks for any information you can provide,
J D Capps
Views: 363
Permalink Reply by Skip Peel - Mineral Consultant on When a lease offer comes with "no real" information, it is a red flag. Those usually come from speculators who look to flip leases. The usual approach is to offer a somewhat higher bonus to lure those who do not understand the real money, usually, is in the royalty. The royalty offer is lower than what the company is looking for. The spread is their profit. When at all possible, lease to the operator of the brine plant. Directly or through a "land" company that represents them. In that case, more often than not the land company will reveal who their client is.
JD, it would be helpful if you would ask them to send you a lease for your review. I think many members would be interested to know the terms.
Permalink Reply by Joey Capps on The letter was on Exxon Mobil letterhead.
There were two Landmen listed as Leasing Agents to contact.
Address of Exxon Mobile was
22777 Springwood Village Parkway
Spring, TX 77383-1425.
The Landmen were
Derek Jones and Fred Callender.
Permalink Reply by Skip Peel - Mineral Consultant on Good to know, thanks. I would lease to Exxon but the terms are still important. Someone in Cass needs to identify a local attorney who is handling Exxon leases for landowners.
Permalink Reply by Joe B. Lovelace on Exxon is taking leases in Cass County under the name Red Oak East LLC.
Those interested can go to the Cass County Clerk website and search for leases recorded and signed. https://cc.co.cass.tx.us/RealEstate/Search
I am unaware of the terms received by the Lessor.
Permalink Reply by Skip Peel - Mineral Consultant on It would be a surprise to find a full lease recorded in the public record. Doesn't Texas allow Memorandums of Lease to be filed to evidence a lease?
Joe, I get an error message when I click on your link.
Permalink Reply by Joe B. Lovelace on Type this into your web search engine and it will take you to the Cass County Clerk platform to enter a search.
Go into that site for "Real Estate". Click there. Go to "Search Real Estate Index". I then search under "Party Name".
I entered Red Oak East LLC and all leases recorded up to May 6th are shown.
You are correct that it is not the entire lease but a Memorandum with pertinent details provided.
Permalink Reply by Skip Peel - Mineral Consultant on Thanks, Joe. A five year initial term with a two year extension option takes us well into the next decade. Memorandums of Lease are intended to hide detail from the public especially the royalty. Bonus per acre is never in the lease but appears in the cover letter that comes with the lease. Lessors execute the lease and the memorandum and the lessee records only the memorandum. Lessors need to build a mineral file and keep a copy of the full lease. As some point hopefully a unit survey plat or a certificate of pooling will be available. Keep that also.
Permalink Reply by Carletta Howard Burrows How does one know if the royalties for a Brine-Sourced Mineral Lease offer is a fair offer. My O&G lawyer says this field is so new that there is not a lot of information available. So how do I know the I am being offered a fair royalty for the brine-sourced minerals (lithium)? The property is in Cass County. I own the mineral rights, but not the surface rights. I did go to the Cass County Memorandums, but there is no royalty information.
Permalink Reply by Skip Peel - Mineral Consultant Carletta, the lithium companies are working to keep details from the public as to the royalty that particular owners are getting. Your lawyer is right and since production will not occur until 2027 or later, it's best to wait for more information.
In Texas there is a different and in your case more important question. The state has not determined who owns the minerals in the case of mineral rights severed from the surface estate. We don't yet know if it will be the mineral owner or the surface owner who ultimately owns rights to the Smackover brine. Joe Lovelace follows this for the members and he will let us know then that question is answered.
Permalink Reply by Carletta Howard Burrows Thank you Skip Peel, but this lease from ExxonMobil also includes 25% royalties for any G&O discovered in the process. Plus, an incremented bonus per each 5 year lease. I have a meeting with my lawyer tomorrow. The mineral rights have not been leased for years. I would like to see this asset working instead of dormant.
But, you are right, there are a lot of questions to be answered. I have been sitting on this for over six months. It has taken me that long to track down was offering the lease. I finally found out it is an ExxonMobil entity.
Permalink Reply by Skip Peel - Mineral Consultant The O&G royalty is good but the real issue is whether there is any real interest in O&G. If I was guessing, I would say NO. If Exxon thought that your location had economic oil and gas, they would not have waited until they were chasing lithium. I'd take it but would totally ignore it for the purposes of negotiating a royalty on brine elements. It is possible that Exxon is using the high O&G royalty to lure mineral owners to accept the brine royalty they prefer. If the outcome of the Texas question gives the rights to the surface owner, your O&G quarter royalty may very well be worthless.
Another question would be, does the Arkansas lithium royalty of 2.5% now have any implications in Texas? We have had reports on lithium royalties in E TX as high as 10% however those leases are open to deductions. What deductions lithium producers will impose on their lessors is unknown. I suspect that there will be some.
Permalink Reply by Carletta Howard Burrows Great food for thought and discussion with my lawyer. Thank you for your time and input. I truly do appreciate all that I am learning on this website.
In researching the decades-old Tuscaloosa Trend and the immense wealth it has generated for many, I find it deeply troubling that this resource-rich formation runs directly beneath one of the poorest communities in North Baton Rouge—near Southern University, Louisiana—yet neither the university ( that I am aware of) nor local residents appear to have received any compensation for the minerals extracted from their land.
This area has suffered immense environmental degradation…
ContinuePosted by Char on May 29, 2025 at 14:42
246 members
359 members
121 members
193 members
146 members
400 members
101 members
150 members
166 members
9 members
© 2025 Created by Keith Mauck (Site Publisher).
Powered by
