Mineral Right offer - The HuntingPA.com Outdoor Community
 
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post #1 of 10 (permalink) Old 04-08-2010, 02:11 AM Thread Starter
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Mineral Right offer

I have some property in a land assocation.I and the other landowners have had a offer on our mineral rights.Does anyone have any input on what would be the best way to negotiate as a group?
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post #2 of 10 (permalink) Old 04-08-2010, 02:38 AM
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Re: Mineral Right offer

I would be very careful when it comes to selling your mineral rights, every land owner in my area has been offered something from companies trying to buy our mineral and gas rights. usually the offers are way to low, a friend of ours that is getting gas royalties told us that in two months he got as much as these companies were offering.Just be careful not to sell something you wish you had not.
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post #3 of 10 (permalink) Old 04-08-2010, 09:42 AM Thread Starter
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Re: Mineral Right offer

No, I wouldn't sell them.I mean leasing them, which they didn't have in the offer.Does anybody have any experience with leasing as a group?
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post #4 of 10 (permalink) Old 04-08-2010, 11:10 AM
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Re: Mineral Right offer

I agree with jj103.5, I know people that have been offered what seems to be pretty good money up front for the mineral rights but when you sit down and figure out it doesnt make sense. If you figure out what a lease would bring in, often the cash in the long run (and sometimes not to far into the future) will out weigh the upfront purchase. Remember, these companies usually are smart and have the best interest for them so if the upfront cost is pretty high, they usually hit a good site not far away and are pretty sure the area will produce well and be worth thier time
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post #5 of 10 (permalink) Old 04-08-2010, 11:23 AM
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Re: Mineral Right offer

DO NOT sell your mineral rights! Once you sell them they're gone, and you can really lose out in the long run. People are leasing their gas and mineral right for 5-6k an acre up here.

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post #6 of 10 (permalink) Old 04-08-2010, 12:36 PM
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Re: Mineral Right offer

there are companys out there trying to lease mineral rights. i will give you a example of one of there gimicks.

they offer the land owner $2,000 per acre and 12.5% royalty on any gas taken.
then they sell the lease to a gas company for $3,000 per acre and 15% royalty( or more)

another gimick they used was to get people to sign with them but they had 90 days to pay the people for the lease or the lease would be void. this gave theese companys 90 days to shop your lease and make money off it. if they couldn't sell the lease to a gas company , they just never paid the land owner, thus it voided the lease. problem was , they had your land tied up for way over 90 days , by the time you filed the necessary paper wiork to void the lease. this prevented people from making other, more lucrative deals during that time frame.



that is usally the angle they are looking at. it happened up here a couple years ago. a lot of people saw it as quick money and jumped on it, only to be very disapointed down the road when they figured out what they missed out on.


my advice would be to wait untill the gas company is ready to lease in your area. then get a reputable lawyer who has experiance with gas lease to help you.

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post #7 of 10 (permalink) Old 04-08-2010, 07:40 PM
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Re: Mineral Right offer

My father is part of a co-op that is involved with this. Their group is in WV and last count I believe there were 200,000 acres in their group. There are advantages and dis-advantages. As a group your bargining power is greater and your more appealing to corporations because of the acreage. You hold more of the bargining when large tracts are concerned. The diss-advantage would be everyone in the group has to agree to take a company offer or you loose it all. Before the stock market crash I will not name the company but our group was offered 5000 per acre and 15% royalty. The market crashed and before the group could vote the offer was resinded. This in the future will present a barging chip for our group because we know the potential. Its just a waiting game now.

Harvesting imature game removes future trophies. Patience is rewarded.
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post #8 of 10 (permalink) Old 04-09-2010, 12:11 AM Thread Starter
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Re: Mineral Right offer

Thanks for all the info.
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post #9 of 10 (permalink) Old 05-18-2010, 01:34 AM
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Re: Mineral Right offer

A good website to read is pagaslease.com.
Bluetick, if pointing to another website is against the rules I am sorry and please remove post.

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post #10 of 10 (permalink) Old 05-18-2010, 01:36 AM
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Re: Mineral Right offer

Make sure of what you sign. There are 2 newly discovered "plays" out there and the Utica formation is supposed to be HUGE. Yes, they have drilled test wells, and its worth drilling.

The man who really counts in the world is the doer, not the mere critic. ~Roosevelt
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