N Richland Hills Mineral Rights (Howe, Hardin: leasing, neighborhoods, purchase)

[michaela1k]

TO ALL N. RICHLAND HILLS LAND OWNERS!

PLEASE READ THIS. IT IS NOT A SOLICITATION AND DOES NOT ASK YOU TO PURCHASE ANYTHING OR DONATE MONEY. THIS IS A GRASS-ROOTS EFFORT TO ORGANIZE OUR NEIGHBORHOODS TO NEGOTIATE WITH GAS COMPANIES AS A UNITED GROUP, MUCH LIKE OTHER NEIGHBORHOODS IN TARRANT COUNTY HAVE ALREADY DONE.

If you own land in the NRH area, you are likely to be contacted by a landman interested in offering you a gas lease, or you may have already received a flyer on your door asking you to call for details. At least two companies (Harding Co. and Chesapeake) are known to be interested in entering into gas leases with NRH land owners for the purpose of drilling for natural gas.

N. Richland Hills sits near the center of the core gas-producing area of Barnett Shale. Barnett Shale is a geological formation which is suggested to be the largest onshore natural gas field in the United States. The gas located in Barnett Shale, several hundred feet below us, has historically been difficult to extract. However, improvements in technology have made extraction of the gas possible through horizontal drilling. The rise in the price of natural gas over the last decade and the predicted future increase in prices of natural gas make drilling in the N Richland Hills area a very desirable prospect for gas companies. The City of N Richland Hills has entered into agreements with regards to city-owned property and gas drilling and production has already begun in our area.

Some landmen interested in getting land owners to sign may make deceptive statements, such as:

1. Your time to get in on the opportunity is limited;
2. There is no competition, so you won’t be able to negotiate for better terms;
3. They have already signed up most of the neighborhood.

There is no rush to sign a lease with any particular company. There is definitely the potential for a great amount of competition in our area. And a recent review of public records with the Tarrant County Clerk shows that only a relatively small percentage of NRH residents have already signed leases. NRH land owners have a right to make an educated decision about leasing, who they want to lease to, and what the terms of the lease should be. If land owners work together as a united body with the gas companies, they will have a greater likelihood of reaching a deal fair to all parties.

Neighborhoods throughout Tarrant County have found that if they get as many residents and companies to group together as possible, the gas companies will compete for the opportunity to drill in the area. Recent successful negotiations have resulted in agreements for over $15,000/acre bonuses and over 25% royalties.

The offers to N. Richland Hills residents are reportedly currently ranging around $1,200-$2,000/acre with 20% royalties. Additionally, the percentage that a mineral owner agrees to in royalties, and the way royalties are calculated, can affect the profits that the mineral owner receives on a monthly basis for as long as the well produces gas, which could be for several decades. This would likely make a difference of several thousand dollars for each partition of land over the life of the well.

Many neighborhoods in N. Richland Hills lack a neighborhood association, so getting neighborhoods together will be a task on its own, but it’s not impossible. All land owners and residents of N. Richland Hills would benefit by having a united negotiating team work together to bring the best offer possible to N. Richland Hills land owners. In order to do so, land owners must immediately STOP signing gas leases. Once you have signed a lease, you are committing your mineral rights to that lease for at least the primary period (usually 3-5 years) and, if the company produces gas from your well within that time period, you are committed to that company for as long as that company continues to produce gas from your well.

In order to begin the process of organizing our neighborhoods into a joint negotiating committee, a free website has been set up for online discussion and planning. Please go to: http://groups.yahoo.com/group/NRHMOA (no www) and join this online community so that we can discuss our options and create a plan. This website is free to use and is the first step in a grass-roots effort to become an organized community with regards to our mineral rights.

[DFF]

Hey all.

If you want to know what your are doing when you sigh a lease, see Enjoy Gas for more info. Why give up control on millions for a small signing bonus?