I understand that I have the right to negotiate the terms of my lease but my questions are more literal then figurative. I honestly do not know the steps to take to negotiate on my behalf. Do I just call them? Or do I have to send them a legal document? I have never done anything like this and feel like a child that is questioning the authority of an adult!
Maybe it will help if you think of it like you have something that they want. That puts you in a position of power. What will make you feel much more so is learning about oil and gas term basics, which you are doing through this forum. So bravo to you!
There are top tier of things I care about when signing a lease- I am on both sides of the fence as both an owner and someone in the business. I don't work OK much, so I am speaking only in general terms, not as an expert by any means. 1. Lease term- as short as possible. 2. Royalty amount vs. bonus amount. As I said earlier, I always want a higher royalty and am willing to take less up front to get it. 3. Gross proceeds on royalty. 4. Lessee must pay for oil and gas used on the lease. 5. Oil, gas and byproducts must be sold to third parties with no affiliation to lessee. 6. Continuous drilling- 90 days between wells. 7. Pugh clause- release everything not in unit (or 40 acres for oil-640 for gas or as state regulations provide) and 100' below deepest producing zone. 8. Protect your lands from drainage. 9. No warranty. 10. Lessee indemnifies Lessor from claims arising directly or indirectly out of operations on the leased premises.
This is by no means everything that is important. It is just MY list of what I consider most important and a brief version at that. I cannot give you advice, except to say ask questions- knowledge is power! There are many, many good folks in the business, and yes, some to watch out for! Have a talk with the company after you decide what you care about. Yes, just call the person who wrote you, or perhaps a higher-up. Do not commit to anything in the initial conversation- give yourself time to think about it. Also ask them to incorporate revisions and send you a new version to think about and discuss as needed. Again, just my 2 cents! Good Luck!
Thank you all so much for the help! Great people here!! 
Hi Jen,
It is very common for the min rights owner to request changes to the leases that are sent out. The company will not freak out and ask to talk with your mom :) (referring to your description of a child questioning authority...).
Call the contact and tell them that you are sending them a list of changes. Mail, fax, or email a scanned copy of the "exhibit A" that you are reading about.
Typically, they will either: send you a new lease with that exhibit attached OR want to negotiate more.
A lot will depend on how big your interest is.
Many of us are just small owners and came from where you are now not long ago, so let us know how we can help.
Jen, Meadows negotiated my Exhibit "A," and the verbage that Wesley Skinner is exactly what the lease stipulates just above the signature lines.
Jen said:
@Claudia, Meadows oil lease is also "net proceeds" which doesn't make me very happy. But not sure if I can do anything about it?
Bravo, Mary Erickson!
Mary M. Erickson said:
Maybe it will help if you think of it like you have something that they want. That puts you in a position of power. What will make you feel much more so is learning about oil and gas term basics, which you are doing through this forum. So bravo to you!
There are top tier of things I care about when signing a lease- I am on both sides of the fence as both an owner and someone in the business. I don't work OK much, so I am speaking only in general terms, not as an expert by any means. 1. Lease term- as short as possible. 2. Royalty amount vs. bonus amount. As I said earlier, I always want a higher royalty and am willing to take less up front to get it. 3. Gross proceeds on royalty. 4. Lessee must pay for oil and gas used on the lease. 5. Oil, gas and byproducts must be sold to third parties with no affiliation to lessee. 6. Continuous drilling- 90 days between wells. 7. Pugh clause- release everything not in unit (or 40 acres for oil-640 for gas or as state regulations provide) and 100' below deepest producing zone. 8. Protect your lands from drainage. 9. No warranty. 10. Lessee indemnifies Lessor from claims arising directly or indirectly out of operations on the leased premises.
This is by no means everything that is important. It is just MY list of what I consider most important and a brief version at that. I cannot give you advice, except to say ask questions- knowledge is power! There are many, many good folks in the business, and yes, some to watch out for! Have a talk with the company after you decide what you care about. Yes, just call the person who wrote you, or perhaps a higher-up. Do not commit to anything in the initial conversation- give yourself time to think about it. Also ask them to incorporate revisions and send you a new version to think about and discuss as needed. Again, just my 2 cents! Good Luck!