J&T Farm":3n8s2a0b said:
The jig is up on buying cheap land and what land is selling does not include minerals. Everyone has the gas bug.
Up here, their paying $700 bonus and around 20%. Unfortunetly, we didn't get near that.
That "bonus" money is chum money. Lots of folks fall for it. A man who bought land for $800 an acre feels he can get his money back if he leases for that. He'll sign a 1/8 royalty.
These oilfield leasing agents are not much more than used car salesmen. Some are good folks but most I have met at trying to get the royalty as low as they can.
Recently I had a guy tell me he wouldn't sign me for a 25% royalty. I said "fine, no need for us to talk anymore." Then he said they would cancel the well. I said "fine." Then he calls all of my Aunts and Uncles and tells them the well is cancelled. EVeryone starts calling me whining about how greedy I was. I told them the going rate was 25% royalty and faxed the guy 6 leases in the proximity. He was shocked. I then told him he had no business telling the family MY business. I think he began fearing a lawsuit. The next thing I know I got his counterpart on the phone and I was continually hanging up on him telling him to pound sand, pretending I was madder than an old wet hen. I then agreed to a six month lease at 25% royalty. We got the well within a month.
Right now they are trying to lease the land my house sits on. Same thing. Got neighbors thinking they got rich and they all signed on for too little.
There is a 25% royalty payout difference in a 20% lease and a 25% lease in that you get $200 for every thousand or $250 for every thousand revenue, etc. When you are looking at making $18,000 a month, that is a lot of nickels. That little ole up front chum money they bait all the poor folks with doesn't amount to much at all.
I am not signing anything for less than 25%. I can afford to hold out. The only sure thing about Shale is that it is a sure thing. Terribly bad wells are netting folks just over $200 per acre per month on a 3/16 lease. There are folks getting upwards of $800 an acre per month on 25% leases, at the current low gas prices.
There is a forum on this subject.
I am waiting for gas lines to be run. Then I will be waiting for them to punch more wells.
I have some links for the RR Commission filings in Texas for anyone interested. PM me. You can find plats, W-1 and P-12 filings etc. for your wells through the RRC.
