Why wait till Feb?

  I keep hearing not to sign a lease until after feb so what’s going to happen in feb to wait

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Permalink Reply by John on January 20, 2020 at 5:42am

State of wv. Gilmer co. And no lease terms just heard that president trump was going to pass something to help out the people of mineral rights

Permalink Reply by Joe C. on January 20, 2020 at 8:11am

John, 

I would certainly not sign any oil and gas lease until you completely understand what your signing. It doesn't matter what Trump will do after February. Here are certain things you need to modify in a lease.

Terms- A lot of times companies will bring you a 5yr + 5yr or 3yr lease. Make sure you get a 3yr lease only or the most of 5yrs only.

Royalties - A lot of leases will give you a standard of 12.5 % or 1/8, but the problem is the "Post Production Cost" The time you sign at 12.5% with these fees, you will only see 6 to 7% total. Same if you sign a lease at 15%, with cost, you will end up with 8 to 9%. Depending on the company, negotiate a 15 to 16% royalty "COST FREE" or "GROSS AT WELL HEAD". Some will also us "NON POST PRODUCTION COST" 

General Warranty Clause- This clause needs to completely come out or have a special warranty clause added. You never want to sign a lease with the General warranty.

Shut in- Make sure you get a higher per acre amount for shut in. Most leases read "$1.00". Try to get $100 or the least $25.00.

Pugh Clause- Make sure you get a Pugh Clause put in.

Depth Clause- Sign only a "Marcellus Shale lease" This will allow you to negotiate a new lease for the deeper rights. (Utica)

Bonus- Where you're located, it will be hard to get more bonus money, but start out at $2500 an acre. 

Get a Compliance clause

Get a Hold harmless clause

Get a "No gas storage clause"

Get a "Non surface" even if you don't own the surface.

Get a "Severabilty Clause"

Don't let the Landman threaten you with "Final offer letter BS" 

Pass this along to anyone that needs the help. I am not sure if you were offered a lease agreement or a friend, but this will help.

Permalink Reply by John on January 20, 2020 at 8:58am

Thanks for the info but the land where we own the land and mineral rights is in the grant district of pleasants co

28clr6acuhbmvPermalink Reply by 28clr6acuhbmv on January 20, 2020 at 5:30pm

    "It doesn't matter what Trump will do after February."

This would be a good time to do some research on the Looking Glass technology.

The White Hats have the Looking Glass.  I have the Insider.

We know what will be.

Permalink Reply by FRACIN MY CH4 on January 21, 2020 at 7:59am

Don’t waste your time trying to educate  DICK Jefferson ....he’s only a small predator troll of the industry, he is merely a temporary hemorrhoid itch on GMS.  better luck with your next career move DJ

Permalink Reply by Jim Litwinowicz on January 23, 2020 at 10:20am

Just a WAG;  Maybe the rumors of two more crackers are the reason to wait. Or maybe China will finally come through with their massive letter of intent to spend huge amounts in WV.....what was it $50 Billion over 20 yrs?  Maybe it is a gas>alcohol pant or some other end user that will drive up interest in the area.

Permalink Reply by shakeshale on January 28, 2020 at 1:05pm
Feb of 2035 ?
Permalink Reply by BW_Appalachia on February 6, 2020 at 1:00am

This likely has to do with some of the proposed bills in the WV legislature relating to royalties.

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