buying a house in ft worth. seller wants to keep mineral rights (Nevada: deal, property)

[loves2read]

unless you are buying a house that has enough land away from the house for a company to put a rig or a processing unit on--you won't have any say about where things go

IF you are buying a house in a neighborhood of other .22 lots--you won't have a say about anything because the rig won't go in your neighborhood...

the type of house that COULD be next to a drill site would be one that borders a sizeable park, a field/acreage that is 3 acres or more since that is about the avg amount of land that it takes to put a rig on...and there would not be a house/school closer than 200 yards (I believe) to that drill site...
I forget what the actual yardage is -- and it can vary from town to town--

the situation where people/homeowners were trying to prevent a pipeline going under their front sidewalks or have a rig go in next door--just don't happen to people in the city as a matter of course...

and folks in some areas there might be lot of homes for sale but people can still hold out for what they consider to be fair offer--they may be waiting for an offer that you or I think is out of line--but it is their decision...
so I don't think that you can call this a buyer's market in the sense that anyone making an offer is going to get what he/she wants out of the deal...

[Eric Fred Norris]

Originally Posted by derekv

Are you purchasing a typical tract house of about 1/4 acre or so? .

yes

Originally Posted by rugerjitsu

1. find out when the lease expires, and if there's an option to extend beyond primary term.
2. find out if the wells have been drilled
3. find out if royalty payments are being paid at this time
4. find out how he's calculating his "$2-3K" premium to get the mineral rights, this should be interesting, unless he's already getting royalty payments.
5. find out where the drill site is...how close to your home?


these are questions you need to know before moving any further with negotiating the mineral rights...get back at me when you find some answers, and maybe i can help more.

1. expires in spring 2011
2. no
3. none
4. do not know
5. none yet

how much should i consider countering with for just the mineral rights, then. 1k? should i even be interested in mineral rights?

the subdivision is in a very hilly area, i cant imagine a rig being placed right next to the house.

[loves2read]

there are laws about how close a rig can go to a house depending on town/area where house is located--it can't go "right next" to the house--as in 50 ft close...

how can the rig be placed next to the house--you said it is in neighborhood of small-lot tract homes...

this does not make logical sense to me...

[rugerjitsu]

Originally Posted by Eric Fred Norris

yes



1. expires in spring 2011
2. no
3. none
4. do not know
5. none yet

how much should i consider countering with for just the mineral rights, then. 1k? should i even be interested in mineral rights?

the subdivision is in a very hilly area, i cant imagine a rig being placed right next to the house.

okay...so there may or may not be plans of actually drilling as of yet. no rigs = no royalty payments, so the owner is basing his $2-$3k for mineral rights on pure speculation.

if you really like the house, i may offer $1k for mineral rights, and see what happens...you would also need to consider who's paying closing costs...is he paying any closing costs?? many different ways to negotiate this...hopefully your Realtor is able to help with that.

[loves2read]

no royalty payments until the well is drilled and gas is found--forget when the rig shows up

production that corresponds to marketable pricing is not a given despite sophisticated mapping/drilling techniques
and you still have about 3-4 months after the gas is discovered to complete the well and tie into the pipeline system and get the payment system up and running--maybe longer if the well has lower reserves than anticipated...

[nsumner]

Lovestoread,
I have a client to whom I sold a house years ago in North Richland Hills off MidCities and Rufe Snow. She has been getting a $130 check a month for about 18 months now. I've asked her if she can see where they are drilling but she doesn't know, she says that all the neighbors she knows have been getting the same amount but nobody has seen a rig.

Any idea where they're drilling?

Naima

[hypocore]

There's a drill site right off Rufe Snow on Hightower.

[loves2read]

if they are getting royalty payments for 18 months--the rig is long gone--there is only a well-head someplace within probably a mile or two of her house--and frankly that might not be that noticible
the way Barnett Shale wells are drilled -- multiple locations in a 360 radius can be drilled from same rig site == much more effective in an urban setting than getting enough area together for multiple drill sites--

her lease should have geographical location of the drill site and explain how her land and neighbors was pooled with other areas to make up enough to make a drilling unit...
there was what looked like a new drill site going up right beside Grapevine Mills mall when we went to show there yesterday--no rig--just the soundproofing wall they put up around rigs...
so any home/business within a mile or so of there could be in well pool and it could drill 4-5-6 wells in different directions from that one site...

the reason you see so many on the airport is that there are no home owners to complain and fewer buildings to worry about the drilling restrictions because the airport board controls all mineral rights ON airport property--but the directions of the wells' drilling can pass beyound airport boundaries into the adjacent areas--AS LONG AS the company has secured mineral rights from those owners...

[derekv]

Form W-1: Field List

At the bottom is a link to the plat for the Hightower 4h well, it along with others affect the area off of rufe snow, all of this info is public and can be found on the rrc website.

[killer2021]

ask yourself this question:

what experience do you have with valuing mineral rights?

If the answer is zero, then don't buy the mineral rights.

Likewise, how often do you see a natural gas well head or oil well head in someone's backyard? Not very often. Suburban areas have been pretty well mapped for minerals and texas has peaked for oil and natural gas production.