Does anyone know whether when you lease is up you have to pay back your bonus you received in the beginning? I am new to this so any help would be appreciated. Also my family cannot afford an attorney to sort through the legal papers. Thank you for any help regarding this matter.
The bonus is yours to keep. The lease is essentially the right to drill on your minerals and remove them. They do not have to drill. You can think of it as a “rental” payment for a certain period of time which is paid up front.
If you are new to this, you might want to read the Mineral Help tab above and read a small booklet called Look Before You Lease by Jim Stafford. Those legal papers are really important. Generally, the first lease a company offers you is not in your favor. It can hold you for decades if there is production. Almost everything in it can be negotiated more to your favor. Read up as much as you can on the Tyler Co topic areas here, talk to the NARO (National Association of Royalty Owners) Appalachia chapter and get more insight before you sign anything. www.naro-us.org
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Vicki7 my understanding is that the lease bonus is paid as an incentive to get you to agree to lease your mineral interest to a company who then under the terms of the lease decides when and where they will potentially drill. If under the term of the lease, say 5 years for example, they do not drill or commence operations to drill then your lease is terminated. A new lease would need to be negotiated and a new bonus paid to you if you sign. I had a 5 year lease with Chesapeake and they never commenced any operations so the lease would have terminated. Southwestern Energy bought the leased area from Chesapeake and I negotiated a new lease for 5 years with updated terms and a new bonus. It is yours to keep.
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