Who has ultimate rights in New mexico: Land owners or Mineral rights owners? If the two disagree, who gets final say? A company wants to do seismic surveys of our land - of we own 100% of the land and 50% of the mineral rights.
They said “if you don’t agree to our terms, we’ll just go around you to the other mineral owners, and get their agreement”.
So I’m wondering: in New Mexico, who gets final say? Could a company end up doing surveys on our land against our will, if they get the agreement of the mineral rights owners (which own 50% of the rights on the land)?
Back story:
We are full land owners and 50% mineral owners of 120 acres in Eddy county. Meaning: we own 120 acres of land and half of the mineral rights of that land (60 mineral acres).
We have been contacted by a seismic survey company that wants to do seismic survey of our land, for a very low amount of pay ($3000), which basically only covers the cost of the damage they would incur with blasting and such.
We counter-offered that we would agree if they provide the report to us as well. They disagreed and tried to strong-arm us into agreeing by saying “if you don’t agree, we’ll just go to the other mineral owners and get their agreement, and then you won’t even get this much”.
So this makes me wonder if this would even be possible. Who gets the final say on what happens on land in New Mexico: Land owners or Mineral owners. And if 50% of the mineral owners agree and 50% disagree, then what would happen?
I hope this question makes sense. Thanks in advance for any help!
Usually only the surface owner is compensated. If the minerals are under lease, the oil company may be able to grant permission, but surface owner still needs to be paid. Seismic payments are not close to bonus payments. $25 per acre is not unusual, at least in Permian area. Maybe someone can post what they have received in Eddy County. They can get some portion of the data under your land by surveying adjacent to property line, depending on the dimensions of your tract. If you come to an agreement, be sure to review and update the terms, such as set a date by which the survey must be conducted; limit to a single survey with additional compensation due for a second round; no helicopters can land; require payment for all 125 acres even if some not surveyed.
The seismic company is not strong-arming you. Their comment is perfectly legitimate and is common business practice.
It is extremely unlikely that the geophysical company will give you the seismic data. It can cost millions of dollars to shoot and they consider the data highly proprietary to the company that contracted it (unless you want to pay for it!) Seismic data requires very sophisticated 3D software and computers and knowledge to interpret it. The seismic does not spit out a “report in words” that a lay person would understand. It takes months to process highly mathematical data and even more months for a geophysicist or geologist to interpret it. (Spent several decades of my life doing this type of interpretation.)
The surface owner is usually paid a small fee per acre and perhaps some improvements. We had a nice pond road done on our property instead of getting paid.
Yes, they can get other mineral owners to give their permission. In some states, it only takes one mineral acre to give approval.
Your larger question is about who had dominance. Most of the time the mineral owner has dominance over the surface owner. Been that way for centuries. If you have the complete ownership of surface and minerals in fee simple, the you have more leverage, but if you don’t have all the minerals, then the other mineral owners have their leverage on activity below the surface.
Thanks for your reply M Barnes. You said taht in some states it only takes one mineral acre to give approval. Do you know if that is the case for New Mexico?
And in our case where we are BOTH the land owners (100%) and the mineral owners (50%) - what would happen if 50% of the mineral owners agreed to this survey, and 50% disagreed. So let’s say we disagree, but every other owner agrees. This means there’s a 50/50 agreement/disagreement. Do you know where the judgement would land in such a case?
As for “strong arming”, the way they worded the email they really were saying “do what we say or we’ll just go around you and won’t even pay you that small amount”. To me that is strong-arming. Maybe it depends on your definition.
In short, it was a deal where all of the benefit went to them. I understand deals, and negotiating, but usually there has to be a “win” in it for both parties. In this case, they would have been doing all sorts of blasting (causing damage probably?) to our land, and the only reparations we would get out of it would be $3000, which was only to cover the damage they caused. So they walk away with a very valuable seimic survey report, and we get…What exactly? $3000 for damage caused to our land?
Again, in deals such as these there has to be benefit to both sides, which did not seem to be happening, nor did they seem to care about that at all. A very one-sided deal to say the least. With a bit of attempting to strong-arm thrown in, in my mind.
Drilling ahead nicely next door. Tolerable. I’m just the guy next door with surface rights only but I made sure they can’t drill on my property. Fun to watch but not on my property