Royality

No knowing anything about leasing, was wondering if the offer of $20.00 per acre plus 12.5% royalties is average price. I only own 1/3 of I think it is 20 plus acres...

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Permalink Reply by Nancy Mosley on October 31, 2014 at 12:52pm

Where is this located?

Permalink Reply by Carol Joan Chancey on October 31, 2014 at 12:52pm

Roane County, WV

Permalink Reply by Nancy Mosley on October 31, 2014 at 12:59pm

Roane County website for GoMarcellusShale

You can go to the above link and join, and ask.

That sounds way too low, both the $ amount and the %. In Ritchie is is 15 to 18 %, and $2000 up. Roane, while farther south, isn't so far away that the numbers should be that low.

Permalink Reply by Carol Joan Chancey on October 31, 2014 at 1:02pm

Thank you I just joined and posted...

Permalink Reply by Timothy M. Greene on October 31, 2014 at 2:12pm
Please don't sign anything for $20 an acre and 12.5 percent royalty
Tim Greene
Permalink Reply by Carol Joan Chancey on October 31, 2014 at 2:22pm

Do you know of anyone in the lease business who could do us better?

Permalink Reply by LERRET on November 1, 2014 at 5:39am

Virtually anyone.

Just be patient. If the area is going to develop, then other players will be coming to the party soon. And if they don't then $20 an acre isn't worth the aggravation of the process. Once a well or two is drilled, then the lease offers should be much much higher.

PS - check www.naro-us.org - they have books to help you understand the business.

Manage your minerals like you would manage an apartment. Keep records, study and be cautious about almost everything a landman tells you.  IF their lips are moving there is a 50/50 chance they are lying.

Permalink Reply by LERRET on November 1, 2014 at 3:56pm

Lease hounds are paid a commission to lease or are paid "day rate" and they rarely will divulge their client's name. They rare operate as open agents attempting to lease, then peddle that to a company but some do operate as small royalty companies and buy leases to flip to others.  You really don't want to deal with them since the offers will be low-ball from the get go. It is better when they come to you, as then you know they (the oil company) targeted a specific area and will attempt to lease there.

I would say your leases would be better marketed through an open auction system or broker such as www.mineral-hub.com

PS-I don't get any fee for naming that site or referrals.

0ym9x5ag7ury2Permalink Reply by 0ym9x5ag7ury2 on October 31, 2014 at 2:34pm

Tim,

  I couldn't have said it better myself.  Thanks.  Ron Hale

Permalink Reply by S S C on November 1, 2014 at 7:21am
Where my property is, leases that went for $5 an acre one year were going for $3000 an acre a couple years later. No one would make you any offer unless they expected that to happen to yours. Be a little patient and it will pay off big.

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