We inherited Mineral Rights from my grandmother which are part of the Samuel Gates League. Chesapeake Energy has the Bieberstein Well in Lee County from whom we are receiving sporadic royalties. We have been approached by Brushfire Minerals asking us to lease our interest for a new well on the Samuel Gates League. Not sure what to do…what questions to ask, what to negotiate for, etc. Any help would be appreciated.
Welcome to the forum.
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I am moving your post over to the Lee County, Texas topic area for you.
Most of us would want the highest royalty lease that we could get. If you have not leased before, highly suggest that you get a good oil and gas attorney to review any draft lease as they are not usually in the mineral owner’s favor. It will need some significant edits. Make sure that your probate/title information is properly filed in the Lee County Courthouse with the recorder of deeds so that the landmen can find you. Get familiar with the Texas Railroad commission website so that you can see the wells that you already have and what permits might be pending around you.
If I own only 1 mineral acre in an 127 acre league can I draw royalties from two different operators drilling on that land?
It depends upon where your one acre sits with respect to the wells’ spacing. And it also depends upon your lease language and if you have depth clauses, Pugh clauses or other restricting language.
For example, if you have a shallow operator A and your one acre is in Well A’s spacing of 80 acres, then you may have royalty from that well if your lease allows. If a deeper operator B comes in and has a horizontal well that is spaced at 640 acres or some larger unit and your acre is in the spacing and depth for Well B, then you will get both. But if the shallow operator does not have your acre in their spacing, then you may not have royalties from the shallow well. Just depends upon where you sit and how your lease(s) read.
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