Hello again,
My Mother's lease contract came in today. After reading the contract I had some questions and some reservations. Can anybody assist?
1) If she is one of 5 heirs and there are 320 net mineral acres how is it that Hoover & Stacy, Inc. is only concerned with 13.33333334 acres? (Even if H&S only wants to lease one of the two quarter sections she has mineral rights for shouldn't that add up to more than what is being offered up net acre compensation?)
2) Her contract mentioned an odd $10 payment mentioned paid in full by her. Up to this point she hadn't and for whatever reason H&S never mentioned it. What is it for and who exactly is paying it?
"1. That lessor, for and in consideration of --Ten-- dollars ($ *10.00* ) in hand paid, receipt of which is hereby acknowledged, and of the agreements of lessee hereinafter set forth, hereby grants, demises, leases and lets exclusively unto lessee the lands described below for the purpose of investigating, prospecting, exploring (by geophysical and other methods), drilling, mining, operating for and producing oil and gas, or both (as defined below), together with the right to construct and maintain pipelines, telephone and electric lines, tanks, ponds, roadways, plants, equipment, and structures thereon to produce, save and take care of said oil and gas (which right shall include specifically a right-of-way and easement for ingress to and egress from said lands by lessee, or its assignees, agents or permittees, necessary to or associated with the construction and maintenance of such pipelines, telephone and electric lines, tanks, ponds, roadways, plants, equipment, and structures on said lands to produce, save and take care of the oil and gas), and the exclusive right to inject air, gas, water, brine and other fluids from any source into the subsurface strata, and any and all other rights and privileges necessary, incident to, or convenient for the economical operation of said land, alone or conjointly with neighboring land, for the production, saving and taking care of oil an gas and the injection of air, gas, water, brine and other fluids into the subsurface strata, said lands being situated in the County of Converse, State of Wyoming, described as follows, to-wit:
Township 33 North, Range 67 West, 6th P.M. Section 30: S1/2"
3) The new "onus sum of $2666.67 of which $196.00/net acre is the base bonus and $4.00/net acre is for "prepaid rentals". This makes her 13.33333334 net acres worth $200.00 per acre. Royalties are set at 1/6 (0.1666666666666667%).
a) Is this a fair price? Elsewhere in the county I had seen BLM and WY state land leases auctioned off for lower per acre bonuses however they had both attained a better royalty (3/16).
b) What are "prepaid rentals" and why do they pay this fee?
c) What are the chances that my Mother could negotiate with H&S for a higher net mineral acre bonus and royalty (The royalty is really my concern for her)?
d) Kaiser is the drilling/extraction oil and gas company that applied for drilling permits with the WYOGCC... would they offer a better contract? What about other companies... Cheasapeake, Anadarko, etc.?
4) If my Mother accepts this offer and she deposits the draft check (actually a collection item that can take up to 45 days to process) is requested by my Mother's bank....
a) Then doesn't H&S have the right to immediately take up operations?
b) Does this place my Mother into legal liability for the any potential ongoing environmental/property damages caused by H&S during these 45 days?
c) What would be my Mother's legal recourse for seeking financial compensation during this 45 days if she still hasn't received her bonus money and/or royalties should H&S somehow need to file bankruptcy and pack up before paying out anything in those same 45 days?
5) How often are royalties usually paid out and how?
6) I am trying to find out who and how many people own both the land surfaces and the mineral rights for this property. I haven't been successful obtaining a property tax id# for this property and therefore I am unable to look up who owns the land surfaces of these 320 acres.
I contacted both the Converse county Assessor's office and the county Clerk's office. Both responded very quickly but each stated they don't do research and could not assist me without certain information first. Yeah, I don't know how to get that information either. One of the ladies who responded provided a Landsman's contact info but we don't have the $500 - $750 to do pay the Landsman.
I do have a copy of the original Land Patent in my Great-Great Grandfather's name and at some point my Great Grandmother owned title to this property and the mineral rights. However, I don't even know if that would help. Any ideas on how to find out this info?
Any assistance if a great help. I just have no clue how to do this research and make sure my mother is armed with as much knowledge as possible.
Thanks in advance for any help or advice.