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Permalink Reply by Samuel J. Orr on February 27, 2013 at 12:32pm

Are you crazy? Do not lease with these fly by night companies who have no substantial  assets, no ability to drill, and no ability to even pay you bonus money unless they are able to " flip" the lease to somebody else at a profit during the so-called "due diligence period or grace period. Please go read the thread "Help Research Dux, LLC"if you want to be educated? Failing that find yourself an attorney knowledgeable in O&G leasing and have him review documents and check out company before signing. Sign leases with companies like Antero, Anandarko, BP, Chesapeake, Range Resources, Seneca, Hilcorp, Chevron, XTO, and a number of others who have big bucks, the capital necessary to drill,  and are companies who can pay you money if you ultimately have to sue them. If you have never heard of a company, run, run, as fast as you can in the opposite direction!!   

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Permalink Reply by DJM on February 27, 2013 at 12:43pm

Sounds like good advice!  

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Permalink Reply by Kenneth E. Williams on February 27, 2013 at 3:08pm

Thank you, I figured if I could not google the name of the company that it would probably be a flyby night company.  There is already a lease, this company referenced is apparently offering to BUY the minearal rights ,not thr land.

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Permalink Reply by JR on February 27, 2013 at 12:52pm

Looks like they're offering $2,000/acre which is almost certainly lowball, and a permanent decision. These investors clearly intend to make a profit off this purchase at some point. As many people on here know, half-million dollars can be life changing for many people, and she should only make decisions based on her personal story. But she's probably selling at a severely decreased value of what the land's worth long term.  And if they drill on the land, are they prepared to lose a good chunk of it for recreational/farm use, etc?  And, elsewhere on here, I've seen where the prices floated for mineral rights never actually come to realization.  All just what I've observed.  I'm not sure I could ignore $500,000 if someone came knocking on my door...

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Permalink Reply by Samuel J. Orr on February 27, 2013 at 1:28pm

I would put it a little stronger. They are out to fleece you! The offer is absurdly low! I think calling them a bunch of "crooks" would not be too much of a stretch.  It would be better to lease to a reputable O&G company, get some bonus money up front, and have the potential to collect serious royalties when the infrastructure develops, wells are drilled on your property, and the price of gas has increased! Never ever sell your minerals outright thereby severing mineral rights from the surface estate forever. When you lease, you lease the O&G. If you might have coal, you lease that separately. I hope this is helpful!! 

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Permalink Reply by JR on February 27, 2013 at 1:36pm

I agree with Samuel, but maybe you're already leased? I recently saw on here that the mineral BUYERS come around when they see you'll be in a unit...has SIL researched this yet?

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Permalink Reply by Kenneth E. Williams on February 27, 2013 at 3:10pm

The land is already leased.  The referenced company/llc apparently offering to buy the mineral rights, not the land.

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Permalink Reply by Clinton44 on February 27, 2013 at 5:19pm

As I have posted on this subject before whenever it comes up on here...

Kenneth, please tell your relatives to think this over very seriously....

AND consuly a very experienced gas and oil attorney if they choose to do so, these people are royalty buyers don't know this particular company but in my book they are all the same...

We have land in Clinton and Lycoming Counties and were approached by these types of companies with very large checks in hand offering to buy just half of our royalties. We figured if they were after just half they must know something we don't we held on to everything. The royalties we have recieved in a little over a years time have made their offers now look like chump change!

Now we were lucky we are in an area where there were existing transmission pipelines and other related infrastructure, which made our area attractive to the drillers because all that they needed to do was put in the gathering line systems and they could get their product to market and see an imediate return on their investment.

I do not know the situation in Sulivan County as far as pipeline infrastructure goes... 

Your relatives have many things to consider... Here are a few for starters.

Do they need the money right away or can they hold out?? ( Because even though they say there offer is only good for today, this week, this month etc. they will be waiting in the wings at any time to snatch your land up. They did their homwork they are not going to invest that kind of money to buy royalties on land that is not going to produce at some point) 

Are they in a proposed drilling unit?? ( Check the County courthouse for filings of declarations of pooled units or lease assignments to joint venture companies)  

Is there infrastructure in or coming to the area of their property??

Good luck let us know how you make out!

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