Congratulations, Ann59. I was you 4 years ago, inherited a small fractional interest in a tract in Reeves County TX, was totally ignorant. Happy ending, my small acreage is producing excellent royalties from the first well, and I expect many other future wells in this “stacked pay” … I’m part of a 640 acre pool that will have numerous horizontal wells stacked & staggered at different depths. Our first well paid $10,500 royalites per acre in the first two years, not including lease bonus, despite low prices in the pandemic, and there will be more future wells drilled. I regard our well as 4-star, pretty good but not great.
It was much work & research for me (I’m retired), and some legal expense, but I enjoyed the learning process and especially receiving bonus & royalties. This forum website helps very much. Suggestions …
First, I phoned the landman often, pestered him, learned more from each call. (2) looked up my section on the Texas Railroad Commission online map, delighted to see all the “offset” wells in the vicinity. (3) Looked at the monthly oil & gas produced by the offset wells, told me the kind of production success, you can do some math, e.g., 2-mile long laterals cost $7-$9 million, pay 25% royalties, you can gauge how quickly wells break-even (payback) for operators.
(4) I needed to record an Affidavit of Heirship to improve my clear title, because of intestate death in my title chain, your landman can tell you have clear & strong your title is. You might need to record probated will(s) in the Texas County. (5) I learned to use TexasFile to search county land records to do my own title searching of our tract’s history.
(6) I learned who my neighbors are in the two sections, in which our 2-mile long lateral was to be drilled. Some neighbors were superrich with huge acreage, I downloaded their recorded leases, and saw where their lease addendum provided good terms, I insisted on signing an identical lease, far superior, especially because it did not reduce my royalties for post–production expenses for either oil or gas. I also replicated the requirement that lessee provide me with Division Order Title Opinion on request, so I know exactly who owns the pooled acreage. County property tax records (ad valorem taxes) are public info, I was able to study the tax records to see ownership of surface & minerals.
Your first lease will probably be your last lease, lessee holds it by production as long as O&G is produced in paying quantities.
Obviously, if you’re one of five family members who own an undivided tract, you must collaborate.
Never forget, the landman works for himself/herself, and not for you. That said, if you ask the right questions, most will not lie to you, although they will not tell you things if you don’t ask. You might consider hiring/retaining your own landman, many follow this forum, you could share costs with your other “partners”.