A guy from Halo Land approached me and said that they was working for Ascent.  He offered me $700 per acre, each year up to 10 years, and said that they wouldn't pay it up front. I guess they pay me every year the $700 per acre, and they can cancel any time?  He called it a delay rentals.

Is Ascent the only ones out here offering a crazy delay payment.  I wanted to see if anyone else was getting approached with the same nonsense?   This seems like a bad deal because the price could go up and I am stuck with the $700 for 10 years!!  

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Did his "landowner group" ever actually sign a lease? IIRC, the "terms" of the lease I saw were questionable at best.

Sorry Des, you are wrong. We have signed 3 separate leases, ALL paid in full at signing. What world do you live in?

If anybody is desperate, needs cash and decides to sign a lease which provides for rentals, make sure you add a sentence in the addendum that time is of the essence and if rentals aren't paid in a timely fashion----then the lease is VOID.

Failure to pay in a timely fashion should be identified as a default event

Some rental leases say paying what we owe you is a term not a condition---if we don't pay you---the lease continues but the lessee is just liable for the unpaid money.

That's bad---I don't like lawsuits, too expensive and irritating.

I, personally would not agree to a lease with rentals with any of the existing Shalers.

A friend of mine read my post calling them "sketchy."  My friend said--you mean "seedy."

Indeed.

I have to catch a plane to Montana.

You can get the aforementioned language by working the Goggle button on the internet machine.

Paul,

Good posts, thanks for sharing. 
Safe Travels

Where is your property Brett ?

Here in Millwood township, Guernsey county Ohio I am hearing folks are getting $1000 per acre per year, I think for 5 years. I don't know if there is an additional 5 year term option or not.

A guy even posted that someone here in Guernsey county was resigned at the original price, I think it was $5000 an acre, plus 15%,

 I have not seen any of the other terms of your lease, but here is a superficial comment.:

If you go to the court house and read leases from the late 1800's forward, this was a common practice.

The term of the lease would be for X and if a well wasn't drilled by then the company would have to pay a delayed rental at specified intervals.

So this isn't a flim flam or scam by the company.

Whether or not it's a good deal for the landowner is another issue. Of course this works for the company. Instead of paying out hundreds of millions of dollars up front and end up with acreage it does not plan to develop, the company can choose when and where to extend leases. Thus expending it's capital judiciously.

Is it a good deal for a land owner? Much depends on the other terms of the lease. Plus, can the landowner afford to wait for development? I can't answer those questions. But, if you do not accept the offer are you sure you have the ability to negotiate? Would waiting increase your negotiating power? Will another company ever want to lease your property?

As pointed out in another answer, leasing began at $10 an acre and exploded to $5,000 an acre. If you hold out can you be sure that trend will occur again?

It's a tough decision, don't make it lightly or in haste.

I wish I knew the answers, but what I can tell you is that many of those who claim to know are just blowhards.

Again, take your time. Research.

You folks in Guernsey County are in for a wake up call now that O&G and those who follow them are headed for your front door steps, barns and back doors.

You have all the time in the world, so study everything and sign nothing. Don't be in a hurry to make money until you hear the All Clear that Ohio is once again enforcing theft and RICO laws.

Ohio does have laws that prevent the use of Fraud to get your signature on a contract to tie up Real Estate, so take notes on what is said to get your signature. The old statement "You're an adult, you signed the contract" no longer applies to Ohio's Real Estate when fraud is involved. 

Ascent is about to declare Bankruptcy, but they are trying to buy 10 year rental leases.

That should give you a pretty good idea of the type of dirt bags you are dealing with.

You're dealing with cornered rats!

http://www.bloomberg.com/news/articles/2016-08-26/mcclendon-s-forme...

Thanks for that information, Paul.  Maybe I'll just let these rats drown in their own greed.  I don't need the money, but I do need my farm.  

Brett - This is a completely normal occurrence and was once the everyday way that leases were paid.  It is just like a home, you pay a monthly (yearly) fee to the owner for use of a property.  Only when the shale craze was at full steam did this common practice go away.  Nobody is cheating you, or trying to.  Why don't you ask for a shorter term on your lease, that way, if prices change, you then have flexibility.

If they want it bad enough they are still signing paid in full upfront 5 year leases. I have friends that were recently re signed for 5 years at original terms + 15% with bonus check upfront paid in full.

What township are you talking Scott? 

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