I recently asked Noble energy for a No Production Cost clause to be added to my lease. Below is what the responded with...
That is the #1 asked clause to be added to our leases. If I could have squeezed it into your agreement I would have. That used to be a major chip we would have in our arsenal but it is not approved by Noble. They will absolutely not budge with this issue and I have constantly hammered the point that it would be very helpful if we had the leeway to use. You guys are honestly getting the I can provide, again I don't make commission but I've given you guys the best I can.
What do you think? I received in the lease $2500.00 per acre and 17% royalty.
How long did it take them to come up with those figures? Sounds like they want your property pretty bad. I, meaning me, would not get in a rush and stand firm on that clause and ask for 18%. That clause means a good bit of money. Ask them to pay your property tax increase also when they go up considerably if they drill. The company has to realize they need you more than you need them. That bonus is a one time paid up lease and then they deduct lot's of money for the production cost if they drill and get lucky. Now how does that sound to you? They use your underground land and charge you to dig out the minerals while putting more money in their pockets. That sounds a lot like our government. They say whatever money they got they took it from someone else.
Thanks. They first offered 1500.00 per acre and 15%. I asked why another heir was receiving the $2500.00 and 17% and they said it was a mistake then sent an addendum. So the part they told me about Noble gas not budging on the No Production Cost is probably not true?
Tonya, tell your son we are very proud of him also. Sounds like Noble is hoping you are not in contact with other heirs. We had an heir whom we were in contact with that lived out of state. She understood what we were trying to do as far as getting a good lease. She and her brother signed a non friendly lease and I have heard they got less than a third of what they should in bonus money. Who knows what was sent to them and what they actually signed, since they were not close to the property. Noble, I believe may be newer to that area and Antero is one of the main ones. As far as having pads I would do some checking on that. That may be one of their tactics. The one where they tell you that you are the one holding them up from drilling.
but tax's are taken out on my behave then they take that back from my roy's.. hmmmmmm, 18% hmmmmm. and i do not see how it can be legal to charge me for their transport and refinement!! do i get too tell the farmer that since i chuck the corn i can deduct the cost of chucking??? or if i bought eggs can i deduct because i have too crack the?? well.... no. any of you lawyer what to start a class action to shut that down holla!! i'm game.
Noble and EQT both don't like to give a gross proceeds clause. Contact Antero and see if they're interested. Their main office is in Bridgeport, and they're working hard in Tyler County. Also contact JayBee. They're also working hard in Tyler. One guy who contacted me said he'd gotten Antero and Jay Bee into a bidding war and gotten them up to $4,500 per acre.
$2,500/acre is low in Tyler. You shouldn't settle for less than $3,000, and I think you can do better than that, depending on where your property is and who's interested in it. 17% is also low. Ask for 21%, and settle for 18-20%.
Kyle you sound like just the man I need to talk to. Other than these numbers is there a good lease template covering post production and the million other things I don’t know?
Kyle Nuttall said:
Noble and EQT both don’t like to give a gross proceeds clause. Contact Antero and see if they’re interested. Their main office is in Bridgeport, and they’re working hard in Tyler County. Also contact JayBee. They’re also working hard in Tyler. One guy who contacted me said he’d gotten Antero and Jay Bee into a bidding war and gotten them up to $4,500 per acre.
$2,500/acre is low in Tyler. You shouldn’t settle for less than $3,000, and I think you can do better than that, depending on where your property is and who’s interested in it. 17% is also low. Ask for 21%, and settle for 18-20%.
Noble and EQT both don't like to give a gross proceeds clause. Contact Antero and see if they're interested. Their main office is in Bridgeport, and they're working hard in Tyler County. Also contact JayBee. They're also working hard in Tyler. One guy who contacted me said he'd gotten Antero and Jay Bee into a bidding war and gotten them up to $4,500 per acre.
$2,500/acre is low in Tyler. You shouldn't settle for less than $3,000, and I think you can do better than that, depending on where your property is and who's interested in it. 17% is also low. Ask for 21%, and settle for 18-20%.
For post-production costs, I like to use language that says that royalties will be paid from all gas produced at the wellhead with not costs deducted. If a company wants to use their own language for that, I'm willing to. I just don't want them to list the things they'll deduct costs for, or have them say that they can deduct costs. Read Tawney v. Columbia Natural Resources. My opinion, they have to list the costs in order to deduct them. But read it for yourself.
Bill Leaseburg said:
Kyle you sound like just the man I need to talk to. Other than these numbers is there a good lease template covering post production and the million other things I don't know?
Kyle Nuttall said:
Noble and EQT both don't like to give a gross proceeds clause. Contact Antero and see if they're interested. Their main office is in Bridgeport, and they're working hard in Tyler County. Also contact JayBee. They're also working hard in Tyler. One guy who contacted me said he'd gotten Antero and Jay Bee into a bidding war and gotten them up to $4,500 per acre.
$2,500/acre is low in Tyler. You shouldn't settle for less than $3,000, and I think you can do better than that, depending on where your property is and who's interested in it. 17% is also low. Ask for 21%, and settle for 18-20%.