I’m glad I found this forum because I need a lot of answers. In Aug of '11 we were informed by a landman that we inherited some mineral rights in Weld Co. We scrambled to look up old wills and all the heirs have been identified. We were “verbally” offered $700/a. for 5 yrs. w/2yr. option for $300 and 1/6th royalty for 1 parcel located in the south tier of 8N64W. We have not been in contact since that time. Since that offer, our research has turned up a parcel located in the north tier of 7N64W and both parcels were leased around 1968. Is there any way to find the acres and terms of those leases? Should we contact a landman, oil company, mineral manager or an atty? Any help will be appreciated. Mike
Mike, I would consider $700 p/a and 1/6th would be quite fair. From my knowledge most leases in the 60's were $20 p/a and 1/8 royalty if it wasn't railroad land. That was before any real discoveries and most thought the $20 p/a was a great deal. I recently signed a lease for $700 p/a and 1/8 royalty on 160 acres east of Hudson.
Are any companies drilling in the area presently? If so I would contact their land man.
As far as a attorney? Sure they will gladly take your money, enough said.
Thanks for the reply L.
The reason that I want to check the previous leases is because 1. A previous (Mar '10) lease offer was for the W1/2 of the section. 2. The "Release Of Inheritance Tax Lein" describes the W1/2 of the section. Is that 320a. ? The latest offer was for 160a. of the section. Why is there a difference?
L. Victoria Shupe said:
** The oil and gas leases themselves should be in the property records for the counties in which the properties are located (here as you indicate, Weld County). The royalty should show on the recorded leases and the property it purports to encumber. The bonus amount won't be indicated. The tricky part is following the leases as it is likely that the leases have been transferred numerous times or may not be in effect. Also, you may want to seek additional advice as the rights may still be sitting in the name of a deceased party.
**Disclaimer -NOTE: This message is a general response and not intended to constitute legal advice specific to your situation. By viewing this message you understand that there is no attorney client privilege between you and the attorney responding. This message should not be used as a substitute for competent legal advice from a licensed professional attorney in your state that practices in the subject practice discipline and with whom you have an attorney client relationship along with all the privileges that relationship provides. The law changes frequently and varies from jurisdiction to jurisdiction. The information and materials provided are general in nature, and may not apply to a specific factual or legal circumstance described in the question.
Gary Norton said:
Mike, I would consider $700 p/a and 1/6th would be quite fair. From my knowledge most leases in the 60's were $20 p/a and 1/8 royalty if it wasn't railroad land. That was before any real discoveries and most thought the $20 p/a was a great deal. I recently signed a lease for $700 p/a and 1/8 royalty on 160 acres east of Hudson.
Are any companies drilling in the area presently? If so I would contact their land man.
As far as a attorney? Sure they will gladly take your money, enough said.
Thanks Gary,
Sound like I got a reasonable offer. I think I need to do my homework and research for companies drilling in the area. Any help on the contacts for the companies or their landmen would be greatly appreciated. Mike
Why not counter? Weld County gets 20% royalty, and in the negotiations I did for our family, both companies I was working with went quite easily from 18%-20% royalty. On the bonus, one company would not budge, but the other increased our initial offer by 70%. Both landsmen were very pleasant and easy to negotiate with. They seem to be pre-authorized to go up a certain amount, and then check with their company if they can go any higher on a particular lease. I would suggest seeing if you can get any other companies to make an offer on your mineral rights, to get some competition going.
There are also other aspects of the lease to negotiate in addition to price.
I ran the final lease by a lawyer since I am a total rookie, and he couldn't think of anything else to change. Honestly, through this forum and internet research, you can do a very good job for yourself.
Hello Mike,
I would ask for more. There are a couple of companies that would offer 3 yr lease with a drilling guarantee in 12 mos, 800+ an acre.
James
Does anyone know if anything much is happening in Sec6, T10NR66W, and/or Sec11, T10NR67W? We leased it for $850/acre.