I recently received a voicemail from a company called Community Mineral asking if we are still interested in selling our mineral rights - I called and left a message, but haven’t heard back. I’m wondering if anyone else has received a call from this company, and what your experience has been like.
Thank you.
What county are you in? That might help determining who spoke to you. Depending on county a few active mineral companies in the area
When I get offers to buy, the buyers know something that I do not know, so I try to find out what that is. Do your research in your county and find out what production you have right now and what might be pending future drilling in the area. Offers that I have received have generally been for a discounted amount for the current production for a certain number of years to take into account the time value of money. Offers have not been for the future production. Many offers are ahead of the bit, but some are flippers and some buy and hold. They fully intend to make a profit off of the purchase. My family would prefer to keep those future revenues in the family.
Community Minerals is based in Texas, but buys minerals here in West Virginia. My office has had one deal with them, but I can’t see any evidence from my records that the deal went through. That’s not to say that they welched on their agreement, but I see that my office reached out to them, got one reply back, and nothing else ever happened. I suspect that the minerals that my client owned were too small for them to be interested.
Most likely you got a sales call from them, and when they check their records they’ll be looking at whether they are really interested in buying your minerals. A lot of these companies work this way. They are “fishing” for someone interested in selling; when they get someone on the hook they’ll decide whether they want to fish or cut bait.
I’ve received mailers and machine phone calls from Community Minerals quite a few times. I responded once just to gauge their interest. Never got a response. No guess as to why they didn’t respond, other than they have a big marketing budget reaching out pretty broadly.
I did speak with a representative from Community Minerals, but it turned out my name was the same as someone they were looking for that lived in TX, which I do not. I mentioned we had mineral rights in WV, and they requested information regarding the rights. I put together the information and emailed it to the company. I was told I would receive a response within 48 hours. Only time will tell.
Thank you for your responses and suggestions. It is much appreciated!
Do NOT deal with Community Minerals. On every deed they file, they put a catch all clause to capture any and all minerals owned in the county of the sale even if they are not paying for them.
While this may be true,(I have no reason to doubt you), I lament to say that the inclusion of this type of “catch all” language is somewhat rampant in what I call the “direct mail, carpet bombing” mineral buying business. This type language ought to be a big red flag.
Like I said, I hate to see such practices because it only serves to benefit the buying party, and is often not even recognized by the citizen mineral owner/seller who has not gotten wise counsel in a transaction. Either get educated on the important elements of a business transaction of this type, or hire someone trustworthy and qualified, working specifically and only on your behalf.
An old quote comes to mind. “If you think education is expensive, try ignorance”.
I’ve only had to do this with one company one time. Most of the time you’ll be able to negotiate that out of the agreement. It’s an important thing to look for, though.
Some of those companies also have you sign an option that essentially ties up your mineral rights forever, and they’ll exercise that option when it suits them.
This is quite common in Texas. Not sure where you work.
I suspect you’re talking about a Right of First Refusal. These clauses (or separate document doing the same thing) are the death knell for a mineral owner. One should never ever sign anything like that. This effectively cripples your mineral interest forever. It makes them damaged goods due to their crippled marketability.
I work in West Virginia. We’ve had companies try to get a catchall clause included in their deed, but most of the time we’ve successfully negotiated for its removal. It’s not exactly common here, which may be why I’ve only had to include it one time.
It wasn’t a Right of First Refusal, actually. It was language that essentially gave the company the right to purchase the property at any time in the future. It’s been a number of years since I dealt with it so I don’t remember all the details, but I remember thinking the language was just horrendous. What’s worse is I think it was tacked on to the language giving them the right to do and fix title problems, so it didn’t jump out at you.