Mineral lease

[snoopdog]

Would you buy property that the lease didn't convey? Looking at a tract, never had to deal with this. If it does convey, what are the pros and cons?

 

[backhoeboogie]

Laws are different state to state.

I've got land both ways in Texas. Price is everything.

Water truck drivers toss trash along your fences all day long. When they turn off the main road, they start tossing out the window.

They wanted to put cattle guards in my lanes. Big fights. I move cattle thru the lanes.

Lots of income but big pain in the backside.

 

[Brute 23]

Would you buy property that the lease didn't convey? Looking at a tract, never had to deal with this. If it does convey, what are the pros and cons?

Are you getting the minerals and royalties with the purchase of the surface?

Most likely it doesn't really matter if the lease conveys or not at this point. The deal has been done and you are just along for the ride now.

The real question is should you buy land that the minerals are already under lease... pros and cons? ;-)

 

[snoopdog]

Brute, I'm not sure about this particular piece, but a lot of the mineral rights in OK are tribal.

 

[bird dog]

Does it have a no drill clause on the lease? If so they won't be on the property. You need to do some research on the lease itself and see what the company that leases it has in mind. Some are very easy to work with, most are not. If its a large tract they will probably eventually drill on it. If its small, they may not ever.

I doubt you can get the owner to change the minerals but you can always ask for half. Everything is negotiable.

 

[TexasBred]

Would you buy property that the lease didn't convey? Looking at a tract, never had to deal with this. If it does convey, what are the pros and cons?

Sure, I've also sold land and retained the minerals. You use the word "lease" so I assume it is already leased so you won't get anything out of the minerals, however, you will own the surface and will be paid for drilling sites, pipeline easements, etc.

 

[snoopdog]

Does it have a no drill clause on the lease? If so they won't be on the property. You need to do some research on the lease itself and see what the company that leases it has in mind. Some are very easy to work with, most are not. If its a large tract they will probably eventually drill on it. If its small, they may not ever.

I doubt you can get the owner to change the minerals but you can always ask for half. Everything is negotiable.

There are wells on it, I don't know any particulars yet, we'll be getting with the realtor in a couple of weeks. We did a drive by and the online info is all we have now, doesn't mention "surface rights" only in the description. It has the seclusion we want, and I just don't think I can get used to unfettered access, at any price, we'll see.

 

[ccr]

Would you buy property that the lease didn't convey? Looking at a tract, never had to deal with this. If it does convey, what are the pros and cons?

if the minerals are included in the sale of the property, a pros would be - if in a unit with a producing wells or has a producing well on the property a monthly royalty check may be forthcoming.

A con would be - if there is a lease already on the property and a well has not yet been drilled, in texas surface rights are subservient to the mineral rights, so say you were looking at 50 acres and thought there was a perfect house site in the southeast corner of the property and bought the land. Then the leesee decides to put a drill site where you thought a house would go before you built a house.

A person should have a land attorney represent you in a land transaction and understand the terms of the lease very well before purchasing.

 

[Brute 23]

Dont trust the realtor. Get a copy of that lease and get it to an O&G attorney. If there is existing production it could be an extremely old lease. There is a major play in Oklahoma and you most likely do not want new production coming in with an old lease.

 

[niketsurve]

Very well explained..

 

[TexasBred]

Dont trust the realtor. Get a copy of that lease and get it to an O&G attorney. If there is existing production it could be an extremely old lease. There is a major play in Oklahoma and you most likely do not want new production coming in with an old lease.

Best advise I've heard in ages. Realtors are often necessary to a point but then should be kept completely away from any transactions as they can &^%(^& up just about anything if you let them talk.

 

[snoopdog]

Oh, I won't, Had one try and screw me on this place, she and the other one were supposed to split the commission from the seller. We rewrote the contract after some bargaining, and she had a 6% commission in there to be paid by me, and I called her on it, homey reads what he signs!

 

[Brute 23]

Dont trust the realtor. Get a copy of that lease and get it to an O&G attorney. If there is existing production it could be an extremely old lease. There is a major play in Oklahoma and you most likely do not want new production coming in with an old lease.

Best advise I've heard in ages. Realtors are often necessary to a point but then should be kept completely away from any transactions as they can &^%(^& up just about anything if you let them talk.

I agree. They are there for marketing the property, doing leg work finding a property, or getting you comps on pricing. When it comes to the legality of the contract... get an attorney. I have not bought a lot of things but the few I have I used an attorney. It was cheaper than a realtor comission also.