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Old 09-30-2009, 01:45 PM
 
10 posts, read 34,712 times
Reputation: 15

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I live in the Parkwood Hill area (North Fort Worth, just before Keller). The Caffey Group keeps spamming us with letters in the mail, notes taped to the door, door-to-door guys, and I think we even got a couple phone calls. They keep telling us that most of the neighbors have already signed on, but we are holding out for a better offer. They are only offering $3k per acre (we have about 1/3 acre, so that's only $1,000 to sign) and then 22%. I don't know exactly what that 22% will come out to be. Could be next to nothing after taxes. So I figure we will hold out until they offer more or until they basically ask us what we want. What should we expect to be getting paid? What should we hold out for? What were YOU offered? Let's compare notes!
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Old 09-30-2009, 07:26 PM
 
74 posts, read 184,974 times
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We were offered 27,000 an acre with 25% in annual royalties LAST October. Our HOA met with Chesapeake for several months before coming up with that agreement. We put thousands of dollars into attorney fees, etc in negotiating with Chesapeake. THREE days literally before we were all to sign, they pulled the offer after the drop of natural gas prices. Oh what pain . . .
Anyway, since last spring, they have been offering us 2,500 and acre with I think 20% royalties. They have already signed so much land all around us, most of the independent advice has been to sign the current offer given so that at least we get something. You are right, it is not much to any individual owner but we will likely sign because it will result in close to $100,000 to our HOA which could do something positive for our neighborhood. It seems Chesapeake will get what they want with or without our consent anyway by drilling all around us. We have been told that since it is so expensive to set up the drilling process, they will likely not return at a later date to offer us more money because our subdivision is only 170 acres and perhaps not large enough to invest the money to come back and drill a relatively small section of land. I can see the drop in the offer since last year but I can't see the drop to that degree especially since it is sure to rebound. We all feel pretty exploited down here.
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Old 10-01-2009, 07:51 AM
 
32,612 posts, read 51,207,313 times
Reputation: 18475
first of all--they don't have to take your lease
if they can get enough people to sign they just ignore you
and your oil/gas is basically siphoned off IF they drill a well because it is all in reservoirs/channels below the surface

frankly with the price of NG so low and the tremendous amount of gas under lease I am surprised anyone is still leasing
people around us in the Mid-Cities area that did not sign last fall have had their offers rescinded...

with such a small amount of mineral interests 1/3 of an acre--even with 20% you are not going to see much money---period...
people have the mistaken belief that having mineral rights and signing a lease is going to make them wealthy--not unless they have some decent acerage and a good well(s)
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Old 10-01-2009, 09:49 AM
 
Location: TX
3,043 posts, read 11,041,620 times
Reputation: 1389
we signed with Chesapeak with our HOA. (we were one of the last since I didn't think we even had the mineral rights...so we didn't incur the attorney fees)
This is in Keller

They agreed on the standard (now) of $2500/ acre signing bonus and 25% royalities there after.
We have just under 1/3 of an acre, so I was assuming around $800. BUT... what I didn't know is that MOST of the neighborhoods around here the original landowner kept 50% of the mineral rights when the land was sold to the developers. SO in actualality alot of people in developments only own 50% of the rights. So we got $380.
(the 80 year old widow who sold all the land along Ruff snow about 12 years ago....made a good amount of money. good for her, rather her get it than the builder)

This was back in March and no royalities yet (what I imagine will be... about $10 lol)


As loves2 states, if they don't get the majority of people to sign they will just by pass and work around you, come from a different angle etc...
Thats what happened to My sister in Coppell, her neighbors all withheld. Those who signed (about 2 years ago) made about 2k, those who withheld...nada. They just bypassed that section.

Natural gas prices have dropped, the BOOM is over for now. You are not going to make ALOT of money on your mineral rights unless you own acreage and they are drilling on your prop.

$3000 per acre seems good.
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Old 10-01-2009, 01:18 PM
 
Location: Visitation between Wal-Mart & Home Depot
8,308 posts, read 36,266,473 times
Reputation: 7130
Quote:
Originally Posted by jrburke99 View Post
I live in the Parkwood Hill area (North Fort Worth, just before Keller). The Caffey Group keeps spamming us with letters in the mail, notes taped to the door, door-to-door guys, and I think we even got a couple phone calls. They keep telling us that most of the neighbors have already signed on, but we are holding out for a better offer. They are only offering $3k per acre (we have about 1/3 acre, so that's only $1,000 to sign) and then 22%. I don't know exactly what that 22% will come out to be. Could be next to nothing after taxes. So I figure we will hold out until they offer more or until they basically ask us what we want. What should we expect to be getting paid? What should we hold out for? What were YOU offered? Let's compare notes!
Be careful.

Loves2read is right.

Unless the wellbore actually passes through your minerals or within a certain distance of any boundary of your property (I believe the prescription for the Newark East Field is 330', but I do not know for certain) your lease is completely uneccessary regardless of whether or not your minerals are being drained. Them's the rules in the State of Texas. What you are doing now is what an oil and gas attorney would refer to as "unreasonably witholding from a good-faith offer".

$3,000/acre with a 22% royalty is a pretty good deal for this day and age. With 1/3 of an acre, that 22% royalty is going to work out to be a very small portion of any well revenues (assuming a 640 acre unit is formed, you're looking at unit representation of ~0.052% which may give you $500/year if the operator makes a good well), but no one can do anything about the fact that you own an interest in a very, very small piece of land. What it really comes down to is whether you would rather have $1000 and a small slice of a possible well or nothing at all.

If the operator drills a well, establishes production and forms a unit that surrounds your tract but excludes it then you are up the creek without $1000.

Totally your call.
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Old 10-03-2009, 09:29 AM
 
32,612 posts, read 51,207,313 times
Reputation: 18475
people just thought leasing in residential areas (which NEVER happens in TX really) was going to make them an instant millionaire--
no one bothered to do the math for them...
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