My family has mineral rights in South Benbrook, Tarrant County. I received a letter from EnerVest Energy saying they bought the assets from Encana. I haven't received decent royalties from Encana in over a year but they collect $975 million for the sale of Barnett Shale assets. Does anyone know the impact of this purchase to royalty owners, or if production is continuing, etc. I am about ready to sell my interests. I have tried to contact Enervest with no response.
Dear Brenda,
Don't sell your royalties, Any contract you sign to sell your Royalties, the Big Print Giveth and the Small print take all minerals you have anywhere. The Price of Natural Gas is very low now, so don't sell now, wait for the price to come back in a few years, and with that the price your getting will be higher. Your Natural Gas well or wells will pay for the next 60 -80 years, this is something that you can will to your kids. As far as the $975 million that Enervest paid, that is for future production, and they know the price will come back up. As for Royalty owners, nothing will change because EnerVest will abide by the contracts signed by you when you leased. Most likely Enervest will not even maintain the wells, but that Incana will maintain them and send Enervest they share. Starting with Chesapeake the big one, they over invested in the Barnette only to have the price of Natural Gas shrink because they were drilling today like there is no tomorrow and with the turmoil the us is in, we went from not having enough to having too much natural Gas. So CO had to sell off production so they could have more drilling capital to drill for Oil that is paying the biggest dollars now. That is why there are 475 Drilling rigs in West Texas now. Be Patient, and when the price goes up, so will your check. And when you sell your home one day, you can keep the minerals and continued to receive royalties the rest of your life.
Sincerely,
Chris Wilson
Thanks Chris for your input. I have been reading that there is a glut on natural gas so I understand the decrease in royalties. The problem with my tiny share is that it is only 10 acres with 5 wells and I split the proceeds with two siblings. We only have mineral rights and do not own the property - it belonged to my mother and we received the rights after her death. No one lives on the property. We live in Oklahoma and the property is at Lake Benbrook in Tarrant County. Now I have been hit with a large property tax bill for the wells from the county. It just doesn't seem worth keeping it all based on the little amount we receive and I am too old now to wait a few years to see it come back, and there won't be enough to distribute among my children. I know it sounds gloomy but we are just not big into it and are small time royalty owners. Thanks again for your advice.
Brenda,
My family has 139 acres in Parker County that only has 2 wells on that and I share with 8 cousins, my 7 net acres brings me about $400 monthly, our Parker country taxes were about 100 per well, more than covered by the proceeds. I know that fat check from the Royalty buying company looks good, but if you throw it away it will grow larger next time you get it. We have been getting those letters for several years. I understand you needing money, but Brenda, you will kick yourself 10 years from now, if you let this go. I don't know what your checks are, or how much your well is pumping, it is said that Tarrant county flows twice that of other counties, so they might even have your well turn down on low. They have pump because of the cost to drill and if they stop it can cause a whole lot of problems for them, but there not pumping full speed ahead. You may need to look at your tax bill to make sure they split it between the siblings. Ours is. I recd a tax bill for each well. But the Taxes are minor compared the what you received yearly. 10 acres and 5 wells, I'm assuming that your land you don't own happens to be where the pad sites are. Cause I have never heard of putting 5 wells in 10 acres, usually there is 20 acres or more per well. It takes 5 Acres for a Pad site for some companies. If that is the case, you need to sit tight. If you advanced in age, you might see if your kin folk might like to buy you out, but try first for family, cause you don't want your partners on that well to have non family members. I'm having that problem now, as an Aunt has Died and left her royalties to Shriner and Childern's hospitals. So now there is 8 cousins and two Banks and two hospitals in the family, and you can guess how that is working.
Chris
Would like to talk to you about buying your minerals in Benbrook. Carol
I just got a letter wanting to purchase my Mineral Interests in Parker County, 7 acres, yields about 300 a month from two wells now, certainly not what we expected Gas to do when we first leased. However they are offering 11000 for it, just about 4 years world of royalty income. Some might take this offer, but why should you, even at just 300 a month, 25 years from now you would have received 72,000 and still own the minerals above and below the depth that you leased the minerals at. And of course we know in the future the price of Oil and Gas will go up. We don’t want the price of Natural gas to go up, if your heating her home or making electricity, because just like Oil, we didn’t want to pay 335 per gall for gas which also drives the price of everything up. Good news, if Ener vest does nothing with your lease, you will get it back, learn better next time not to let them have transportation costs and make more in the future. And even if you don’t score big in your life time, perhaps after you leave them to your heirs perhaps another boom will come along like Midland did in the 70’s and now again expecting more oil to come from there than the last time.