Replies to This Discussion

Permalink Reply by Terry W. on September 2, 2011 at 3:05pm

I understand that Exxon/XTO has bought only selective properties, they took their pick, and yes at, 2500 to 3500.

Yes I can believe that it would be  possibly 18%, but they do not pay the percentage without

deductions.  That brings it down a couple of % points.

As far as the fees, I do not know, but I believe that all landowner groups do charge a fee or percentage.

And that could be overall a sizeable amount.

I, personally, deal directly with the oil companies...

Permalink Reply by tomcats58 on September 6, 2011 at 2:58am

Talking to landowners who received the XTO/Exxon lease, most actually got $4000 an acre because they are to be paid a bonus plus delayed rentals totaling $4000. ABC is just the name of the landowners group made up of volunteer landowners, members are paying a 2.2% of their bonus to some hired gun gas and oil guy who negotiated the lease for them, understand he gets nothing regarding the royalty.

The royalty clause says it is a gross 18% deal with some deductions applying when it benefits both sides or something like that, saw it, didn't study it.

Permalink Reply by Terry W. on September 6, 2011 at 3:44am

Sounds more accurate than the info that I got from a landman from XTO.

Glad that I decided not to go with XTO.  I hate untruthful people!!

Permalink Reply by ShaleAdvice (Steven C. Townsend) on September 8, 2011 at 2:54pm

The lease terms and conditions are the most important factors in a lease....not the bonus payment or royalty.

Permalink Reply by tomcats58 on September 9, 2011 at 12:31pm

Absolutely, no matter what they pay up front, it is not enough without the correct lease language. From what I saw, ABC got a pretty good overall deal from XTO because they did get some good lease language. But they got a good deal because they did it as a group which gave them negotiating power.