R. Kyle Nuttall, Attorney
Kyle Nuttall negotiates oil and gas leases and pipeline right of ways for West Virginia mineral and surface owners.
Mr. Nuttall graduated from the University of Oklahoma College of Law in 2007. His first job out of law school was as a landman. He spent two years as an abstractor and two years as a curative landman. That experience provided a unique perspective on oil and gas that most attorneys who negotiate leases don’t have.
Mr. Nuttall has negotiated dozens of leases and dealt with most of the major developers and lease brokers in this area. Because of the large volume of leases he deals with he knows the going rate for bonuses and royalties in the different counties and can help you know what clauses and terms you are likely to be able to negotiate with the particular company you are negotiating with.
You can call Nuttall Legal at 304-473-1403 to set up an appointment to discuss your lease with Mr. Nuttall.
DISCLAIMER: This website will supply general and specific information about oil and gas law but it is for informational purposes only. Each oil and gas company puts unique language in its own lease, and the advice given here will not substitute for hiring a lawyer to review the lease that has been offered to you. This does not create an attorney-client relationship and is not meant to constitute legal advice for your specific situation. The good news is we’re not billing you by the hour for reading this. The bad news is that you shouldn’t act on any of this advice or information without consulting a West Virginia licensed attorney who practices in oil and gas a lot and who will, probably, bill you by the hour.
I got gas rights when I bought the property here in buckhannon r & l oil inherited the 2 well on my property. The gas company is to do upkeep on the well to the meter and I do meter to the house. The owner has made it clear she hates free gas. And my well to me has been swayed witch I found out she turned on full force when turning it back on. That killed the tank due to drawing water into the tank. Also was checked to figure out where leak was. This is when I was told the leak is on the well side not mine. Owener said put chemicals in it. Well is shut down at the well nothing coming from it before it had pressure run little then plunger would close due to lack of pressure on tank side. Owner refuses to communicate says it’s without warranty. It needs leak fixed that’s not a tank no long has gas. It’s been like this over year been trying to get owner to do something. Can you help and how much would it be to help me. I’m on ssa and ssi, am raising my 2 grandchildren my daughter passed away. Would appreciate any help posable whole house is gas this has been really hard on us. Thank you for your time.
Carol klar
That’s a tough situation. How free gas is handled depends very much on the lease that created that right. Sometimes there are a lot of details about the free gas, sometimes there aren’t. I would need to be able to look at the lease before I could say anything one way or another. Could you track down the lease somehow?
We own a small lease that has been with EQT for several years. We usually receive a check near the end of each month, albeit smaller ones lately. I called and spoke with someone a couple of weeks ago when we did not receive our check, and was promised a call-back. I finally reached someone again and was promised an email or another (non) call back. Today we received an email that said, “EQT determined you had been overpaid for royalties and exercised our customary recoupment rights under your lease. Your balance owed is: $9,590.68.” They attached an indecipherable statement ‘for our records.’ Can you help?
Man, that’s a terrible position to be in. Basically, they’re going to not pay you royalties until they have made up the difference between what they think they overpaid you and what they think they should have paid you. I can take a look at their “explanation” but there’s no guarantee I’ll be able to decipher it any better than you will. However, if you want to shoot me an email with a copy of it I can take a quick look. nuttall.legal@gmail.com
Hi Kyle, is anyone getting royalties on the basis of the EU prices($60 mcf)? Or are the accountants. Playing game with selling to midstream companies cutting out the mineral owner from these prices?
Joe
Nobody is getting royalties from the end user price. All royalties are calculated on the price that the producer gets, and the producer is selling far more locally than Europe. If it could be proved that a producer was selling directly to an end user, but they were paying royalties at some midstream buyer’s prices, that would be a heck of a case.
Hey Kyle,
Is the contributing well owner (I think this is the term) still open to a mineral right owner? Seems this could be good if you are forced pooled?
Joe
I think what you’re meaning is non-contributing well owner, also known as a carried interest owner. For others reading this, it’s someone who owns an interest in the well (usually) but doesn’t contribute financially to the drilling and production effort. In the forced pooling law there’s an option to be a carried interest owner. It’s something to think about, because you become essentially a partner in the well. The producer foots the bill for development and after getting paid back a multiple of whatever your share of the bill was, they’ll start to pay you for the minerals produced. As a carried interest owner, you might take on some liability, too, so it’s not a slam dunk decision. There are factors to think through.
Kyle,
I have an agreement (not signed) to run a temporary waterline through my property and over the ridge. They are offering me $20.00 per foot for the waterline, $12.00 per foot for the timber removal. Then there’s $1.00 for the Right of Way and easement agreement. Is that normal or should I negotiate more for the the ROW and Easement Agreement?
That’s not bad, but if those are their initial offers you can do better. The $1 for the Right of Way and Easement Agreement is normal. The actual consideration is always detailed in another document, usually an Order of Pay or something along those lines. Make sure the agreement is not permanent or perpetual. It has to be only for the time they use the property. There are probably some other things to think about, too, so I’d prefer to get a look at the documents before going into any more detail. Give the office a call if you’d like me to take a more thorough look. 304-473-1403.
Kyle,
Myself and many of my immediate family members are in a lease currently with EQT. We just started receiving royalty checks a few months ago and after reviewing the “statements” they send along with the check, nothing makes sense. Also, about a month ago a random person called and said he was going to send me an amendment to sign, said he was working with EQT. I obviously didn’t sign what was sent, but I do feel very behind the 8 ball in the information department of this lease. Is this something you believe you could help with?
Yes, we can help with this. Well, to some extent. Those royalty check stubs are the worst. It’s almost like they’ve gone out of their way to make them confusing. I can help you understand the check stub better by talking about what the different acronyms stand for and how what the different columns and rows represent. I can also talk you through the old lease and the new modification so that you can understand what they’re asking for, whether it will benefit you, and what you can ask them for in return.
Eqt has been screwing me an my family for years I just recently received a new contract to sign an I refuse to do so until I get to the bottom of this now there’s to many things to list of what’s wrong Kyle I would really appreciate if you could reach out with some advice here
There’s not a lot of advice I can give here because I don’t have much to work with. What kind of contract are they asking you to sign? If there are too many things to list, then you should probably set up a time to talk with me. 304-473-1403. We charge an initial consult fee, but it sounds like it will be well worth it for you.
We have received several packages in the mail from a Petroleum Landman & have not yet responded. The package has a Lease Amendment and Ratification paperwork in it for us to sign to lease our mineral rights. They are offering us $200.00 to sign. I found out they have paid others more to sign. I figure if they are paying that much then they know they are going to get something out of the ground. I don’t know what’s fair to get for royalties. We only own just under 2 acres, but we own the most property in our housing development.
Always try to get more money out of them. Where they’re asking you to sign an Amendment, they usually won’t pay a lot of money. However, you can get more. I usually counter at $1000 and see what I can get. There are a number of other things you should ask for, including a No Warranty of Title clause and an Indemnification clause. Give the office a call to set up an appointment with me. 304-473-1403.
I have been made an offer of 6300 for my minerals in Wetzel County Center district.Do you think this is a reasonable offer? I dont need to sell but im not going to live forever and they havnt been paying royalities except for shut in at 500 per year. There is a lease for 17% but i have never seen that.
My cousin has mineral rights to 44 acres in Grant District in Wetzel County. She recently ended a lease with EQT out of PA. Is there any drilling going on in this area and if so, which company offers the best terms?
EQT, Antero, and Tug Hill are the three companies working in Wetzel County right now. If I had to pick, I would probably go with Antero at the moment as I think you can get better terms from them than from the other two. That can change pretty quickly, though, and even depends on where the tract is located in relation to Antero’s main area of interest. Your best bet is to contact all three and see what kind of offers you get.
Hello Kyle, Question about if deed recording date is important in a 2-deed/2-sale situation in Marion Co. WV. Land & O & G rights sold by bank to individual on 4/9/1948, but NOT RECORDED until 9/6/1967. Property not removed from Assessor’s tax rolls under bank’s name and NOT put in purchaser’s name and no taxes paid. Land & O & G rights SOLD AGAIN to another individual on 11/4/1966 which was RECORDED on 12/1/1966. WAS put on the tax books, but not under a specific TMP location, but rather with the 9999….000000 designation and taxes WERE paid by 2nd purchaser and assigns through present. FIRST PURCHASER deeds to son in 1967 and he deeds to
another individual who then later deeds to Consol Coal. Taxes ARE paid by son’s grantee and Consol til present. **** Which deed controls 1st purchaser’s 1948 deed or 2nd purchaser’s 1966 deed? Does it matter WHEN the deeds were filed?
I haven’t had to think about a question like this since I was studying for the bar. Probably it’s going to turn on whether the second purchaser knew that the first purchaser had purchased the property, but I could be wrong. This one’s going to take some research. Thanks for bringing this kind of issue up for other people to see. It happened, back in the day, that a deed would change hands and get put in a desk drawer until then next trip to town. Then it would be forgotten. Usually it wasn’t an issue because when it came time to sell the property again, the deed would get pulled out of the drawer and sent into town with the next purchaser to be filed with the next deed in line. That didn’t always happen, and clearly didn’t happen here. There is going to be some WV case law on this situation, but I just don’t remember it at the moment.
My brothers and I have been contacted by Antero about a lease agreement. We have 53.75000 gross acres and 0.18663 net. They offered a $300.00 signing bonus and a 14% royalty, or purchase of our interest for $600.00. We are seeking your opinion on the offer based on the current status of the oil market in Tyler County. We just need some direction so we can give them an answer.
Thanks for all you help.
That’s not a bad offer but you can probably do better. Ask for $1000 and 18% royalty. Request Gross Proceeds so that you don’t have to pay post-production costs. Get a No Warranty of Title clause and a Hold Harmless clause, and try for a Marcellus Shale only formation limit. With those things you have a decent basic lease. There are other things you can request, but this reply would get awfully long if we went into every little detail. Good luck, and have fun!
Kyle,
I appreciate your website and the assistance you gave me a few years ago concerning a lease with Antero.
Do you have any comments you could share concerning the class action lawsuit against Antero?
http://www.anterowestvirginiaclassaction.com/
Thanks in advance.
kyle what do i get if they force me into a lease small tract they offered 15% flat rate and 300 dollars flat rate to lease and 600 flat rate to buy a bunch of small pieces probably add up to and acre or a little more i don’t want to sell have got over 20,000 for 3/4 of and acre over the last 2 years so i understand there is a new law but don’t know it
It depends on where the property is and how much other people who own minerals in the same tract have gotten. It also depends on whether anyone who has already signed a lease has gotten a formation limit in their lease. For the signing bonus you’ll either get an average of what the other people in the tract have gotten or the highest amount that someone with a formation limit has gotten. For the royalty, you’ll get the highest royalty percentage. A cotenancy lease (the lease they’ll force on you) isn’t a terrible lease at all. Regarding selling, I agree with you. I wouldn’t usually sell. Other people may have good reason to, but if you don’t have a good reason to, then don’t.
my father and mother passed away leaving the family home to their kid. so my father have die, he leave 2 daughter and 1 son. therefore it have been know to have to gas and oil. so we are the heir my father. they have receive money of the land but they have excluded me my sister and brother we have receive a small sucession to receive what we are owe.We have all our paper work and document , so can you help us they have been receiving money started 2010, We desire of father share, Can u help us
I’m afraid that with the information you’ve provided I can’t tell what can or can’t be done. If you’ll send copies of all the documents you have and call the office to set up a time for an initial consult, I can help you figure out whether there is anything that can be done.
My mother inherited mineral rights to 81 acres in 2004 and pays taxes on it but nobody can tell us where this property is for us to check and see if anyone has been on the land how do we get better ways to inform the new owner where they are located.
You’ll probably end up having to run title on the property. However, there may be some quick ways to get around running full title. It really depends on what paperwork you have. If you’ll set up a time to talk with me and send us all the paperwork you have, we might be able to help you get it figured out quickly. 304-473-1403.
I was sent a package that offered to pay a $200 flat fee for a 5-year lease and 12.5 percent royalty. It is for 10.000 gross acres and 0.04464 net acres in Tyler County, WV. Alternatively, I can do a quit-claim deed for $400.
I gather that my portion is 0.04464, which is tiny. (There are a lot of siblings and distant relatives involved.) Is this a reasonable offer, and what happens if I ignore it? I don’t want to be sued, but I also don’t want to ruin somebody else’s land by cooperating with this. The idea that I can decide what happens to somebody else’s idyllic property disgusts me, but I don’t know what my siblings/relatives will do.
Thank you.
If you don’t work with them they will use the cotenancy laws to force a lease on your rights. You’ll get a bonus and you’ll start getting royalty checks if they produce from the property. When you have a very small interest like yours it probably makes more sense to sell. Try to get a little more money out of them, and then don’t worry about it again. They royalties you get from this are going to be very small, even when the well(s) first start to produce (when they produce the most).
I wonder what is the largest rural lot size where I don’t have to worry about someone drilling on my land or close to my house on neighbor’s property? I want to buy a rural house in WV but have this concern. I would be looking in the mountainous part of the state where there’s currently little to no drilling, but there’s shale everywhere and they may expand. I decided to avoid large lots altogether not to have them bring their operations next to me. What size of lot is safe to go with? 1, 5, 10, 15 acres? I assume neighbors also shouldn’t have large lots. Difficult terrain is probably a deterrent for placing a well pad but I want to avoid it too, to some degree.
They place well pads on the top of hills right now, and that’s not likely to change. They were putting them in the bottoms of the hollers but had flooding problems. The sides of hills are more challenging than the tops. If you really want to avoid development you will definitely want to be in closer to town, or in a development where everyone has under ten acres. The well pads these days are about 30-40 acres, and having houses spaced out in under 10 acre tracts should (hopefully) keep them from developing close to you. For the near future it looks like development is going to be confined to areas west of I-79 and north of Route 50 (roughly, there’s development outside this area, but most is close). If you really want to avoid development you move into a suburb or as far away from the area I just described as possible. Or you buy a large, multi-hundred acre tract with the mineral rights and never give the company the right to use the surface. You can take on some risk of buying just the surface and not working with the company when they come knocking on your door, but there’s still a possibility that they might try to force a pad on you. Good luck, and if you set your eyes on a particular tract you can call in and we can discuss the likelihood that that particular tract will have development nearby.
I was sent a package that offered to pay a $300 flat fee for a 5 year lease and 15 percent royalty. It is for 38.1400 gross mineral acres and 9.14803 net mineral acres in Tyler County, WV. Is this reasonable?
That’s definitely not reasonable. A $300 flat fee for 9.14803 net mineral acres is highway robbery. I suspect that there’s something else going on. Most likely there’s a typo or a cut and paste error in the documents you were sent. If you own 9 acres of mineral rights in Tyler County you should be looking at a starting offer of about $2500/acre and being able to work up some from there. The royalty should end up at about 18% as well. Contact the landman and find out whether you actually have 9 acres. If you do, the $300 flat fee was likely an error.
Hi Kyle, I’m hoping you can give me some advice on my fathers situation. He was recently contacted by Antero Resources about them wanting to lease his land. He was unaware that he even had the land, they found him through his cousins will. He was the executor on said will. The land was passed down through that side of his family. I’m not even sure they were aware of the land. So my father is contacting the assessors office to figure how much he would owe in back taxes. The land is 10.75 acres in Tyler County, WV. However in the lease they state the net acreage he owns is only .00672. How is that number calculated? They offered him 15% royalties in the event of production. But no where in the lease does it say anything about leasing the land per acre. Shouldn’t they have to pay to lease the entire 10 acres? They also only gave him a few weeks to sign and return the paperwork. It seems very rushed. I’m happy my father inherited some land and don’t want him to be taken advantage of. Do you think the 15% in royalties would be a good enough deal? Thank you for your time, looking forward to hearing back from you.
So the entire 10.75 acres was owned by one person at one time, it was likely a great-great-grandpa or something. He never sold the minerals and when he died his heirs inherited it. Then their heirs, then their heirs, and so on. Your dad now owns a small percentage of the tract, and so does everyone that’s related to GGgrandpa. Hope that makes sense. Now, on to the lease. The 15% is low, 18% is normal for a negotiated lease in West Virginia. However, when you have six-one-thousandths of an acre the royalties aren’t going to be much. Pennies per month, likely. Push for more bonus money. Also ask for a No Warranty of Title clause, a Hold Harmless clause, Notification of Assignment, No Automatic Extension of the primary term, and a primary term of three years (or anything less than five). Note: they will fight you on the shorter primary term. There are lots of other things you can ask for, but when you have such a tiny interest the main thing you want to do is lease it over and over, getting that bonus money over and over. Having a shorter primary term means the lease will expire sooner. Now, if they start producing gas from the property the lease will stay in force as long as gas is being produced. That’s a bummer. One final thought, they may offer to buy it from you. That’s a pretty good option in this situation because you’re just not going to get much in the way of royalties. If they offer to double your bonus money for a sale, counter with double whatever they offer and see what you can get.
I had inherited a farm and own the mineral rights on it. This farm had been investigated for potential oil reserves. It is on Mudsoc, Flagsprings Road in Gallia county Ohio The geologist (now dead. died several years ago) told my father that this hill on the property dos have gas and oil under it and plenty of it. I am also an amateur scientist and I agreed with this man. Mitchell Energy has the original lease. Many companies that had leased the mineral rights just sat on the lease and not develop it.
Thanks for the info. Hopefully that will come in handy for somebody. I don’t know much about Ohio oil and gas. I’m not licensed to work in Ohio so I don’t track what’s going on up there.
Hello, I am an executor of my best friends will. We are from Virginia. Her father had left her a small percentage of mineral rights in Oklahoma. In her will, she bequests these to be transferred to her sister in law in Texas. I have about finished everything having to do with her will about her estate in VA, but require a receipt of acknowledgement from her sister in law, that she has received her bequest. One company has transferred the interests, while another is requiring a final order of distribution, signed by a judge in OK. My friends intentions were that this be done without much fuss, but it is proving to be quite a headache for me. Any advice?
There’s not much to be done after the fact. Your friend probably could have created her estate plan to make it simpler to administer, but now you have to follow what was set up. Regarding the company requiring a final order of distribution, you might have to do that. You’ll probably have to do an ancillary estate in OK. I actually don’t know for sure, though, because I don’t practice and am not licensed there. You’ll have to find an estate attorney there. You might want to argue with the company for a bit first. You might be able to talk them into accepting an exemplified copy of the final order in VA. It really kind of depends on who you’re working with at the company, the laws in OK, and whether the company has any policies and procedures regarding this kind of situation.
Hi. I’ll explain from beginning to present my situation so that you know everything that is involved. My grandparents were Norweigan. They came from Norway to America in 1910. They went through Ellis Island and signed their names in the book. They were the original homesteaders in Williston, North Dakota and put their stake in the land to claim it as their land, 320 acres. My grandfather patented 160 acres in his name, which was Divide county and the other 160 acres he patented in my grandmother’s name, which was Williams county. In 1912, William Taft signed the original deed to my grandparents land. When no taxes were paid on my grandparents land in over a hundred years, the bank foreclosed on it. I spoke with a lady at the county recorders office in Williston and she told me that someone had purchased my grandmother’s parcel, ( is how she referred to it as) for $300.00, because her side is active she said, but said she didn’t know who purchased it. I have the copy of the patented mineral rights that states they are mine forever and ever. I have been in contact with an attorney there in Williston,, via on-line and have told him of my situation with my mineral rights as I am explaining to you right now. This past Monday, I received a call from Balkan oil. After speaking with them, they said they wanted me to do a submission form, RE: Request a Quote and I Don’t know how to do that, because I’ve never heard of submission forms and request a quotes, because I live in ******** and have been here since 1968. If you would please, could you tell me what this terminology is and what I need to do please.
I’m afraid I won’t be able to help you. I’m not licensed to practice in North Dakota, and I don’t even know any attorneys working there. If you’re in touch with an attorney in Williston I suggest you continue to talk to them. Good luck!
In WV, when is an affadavit of heirship needed? My father passed away with a last will and testament naming all of his heirs.
Thanks!
An Affidavit of Heirship is usually used when you want to identify the heirs but there is no other way to do it. Where your father left a will, and it went through probate, you can use that. If that will wasn’t probated then it’s indicative of who the heirs were, but it’s not legally binding. At least, in WV. If the will was in another State you might have some different laws about whether a will is effective.
Good afternoon Kyle,
Thank you for posting so much useful information. As with many individuals asking for counsel, my mother was recently contacted by a landman (Northeast Natural Energy) regarding the purchase or lease of mineral rights. Until contacted, my mother was unaware of her ownership which she shares with her sister (deceased w/ heirs) and brother (alive). According to the figures provided by the company, she owns 20.36 gross AC, 0.0404 Net AC, with ownership of 0.198412170%. The land is located in Battelle District, Monongalia County. The company has offered $500 for purchase or $150 and 15% royalties for lease. Can you provide some initial assessment of the offer and possible options for us to move forward in determining what is the best option for my mother? Thank you for your time. – Lee
Usually I recommend that people hold on to their mineral rights, but when it’s as small of a mineral right as you have, it might make more sense to sell. The 0.0404 net, sold for $500, is equal to about $20,000 per acre. That’s a lot more than you could sell it for to anybody else, and might be more than you could get in royalties over time. You might have to think about the hassle of dealing with a landman and cashing small checks periodically compared to the benefit of selling now and never having to think about it again. Of course, its possible that that mineral interest could be worth way more than $20,000 in royalties over time. After all, there are multiple producible formations underneath that property, and added up they could end up paying out more than $20,000. On the other hand, renewable energy could find some serious traction and drive the price of natural gas into the ground over the next couple of decades. It’s really hard to say. If you sell, make sure you ask for more money. They usually will negotiate for more. Same for a lease. Call the office if you’d like to talk about any more specifics.
Thank you.
Hi Kyle,
Is XTO trustworthy (currently in a lease for minerals and would like to sell since it’s only 12 acres). I am on a will mineral rights to next of KIN only with about 7 others. Again it is only 12acres, but my Aunt(next of kin) and Uncle got an attorney in Ohio that stated where the land is located (backs up to the side of a mountain and i do not know this area) and they have been told XTO believes that there are 4 to 5 different type minerals present.
Keep in mind I was told my family used to own a coal mine/ coal mines and their last name was Metz. The family split and sold the mines back in the day and that side of the family actually moved to Texas for oil.
I should point out that the 12acres is split between 7 others and 12 acres a piece. I am just hoping that Great Great Grandpa Eugene Metz knew the land..hahaha
Hi Dan. XTO has been bought by Exxon. Back when XTO was in business as a separate entity I enjoyed working out leases with them because I could get reasonable terms from them without too much hassle. I have only dealt with Exxon one time, and it wasn’t too bad. Where you’re looking to sell, you will probably end up selling to someone other than the lease holder, however. There are a lot of companies out there trying to buy mineral rights. Since your lease was with XTO and the family name was Metz, I’m going to assume the property is in Marion County. You can probably sell for between $3K and $6K per acre depending on which side of I-79 you’re on. West is better. However, I generally recommend that you don’t sell. Those minerals should be worth more in the long run than what you can get in a one-time sale. The main question for you to answer is, “do I have something important that I can do with the money now, or am I in a position to hold on to a long-term, speculative investment?” If you do decide to sell, we can act as broker and contact some buyers for you.
Hello. I just found out I have 0.36% mineral rights on 2 tracs of land in Doddridge County WV. Tax Map 5, Parcels 1 and 1.1. I’m told doddridge county is a very hot zone for gas and oil right now. 3 permits have been filed on the land for horizontal drilling.
Ten mile land offered me $900.00 for my rights, which I think is extremely low. Do you think I should sell? If so what is the value of my rights or should I lease my rights? What’s the value if Iease my rights.
Also should me and the other heirs file a avidavide for heirship?
Thanks a lot.
It’s impossible to say whether that’s a fair offer unless you know how many acres of minerals you own. I’ve seen offers in Doddridge County ranging all the way from $10,000 per acre down to $1500 per acre for a sale. It really depends on how badly the company you’re dealing with wants property in your area.
Filing and Affidavit of Heirship can be handy, especially if you think that you may have inherited mineral rights in other tracts besides the two you know about. It makes it easier for other companies to connect you to the original owner, and makes it easier for them to find you. The only important thing with an Affidavit of Heirship is that all the data is correct. If you aren’t sure about a date of death or the spelling of a name or something, then you shouldn’t sign it.
The acreage for the 2 tracs of land is 100 acres
Also I forgot to mention there is 7 heirs on this 100 acres. We all have 0.36% interest mineral rights and we all was offered $900.
Dan Fischer of Ten mile land said he based the figure on $2500 per acre.
Thanks
Hi Mr. Nuttall, My family and I have begun receiving offers from a landman to purchase mineral interest of 100 acres in the Battelle district of Monongalia county. The purchase is for Northeast Natural Energy. Most of us were not aware we owned this and we are trying to figure out the best way to approach this. I don’t know the percent of everybody’s ownership, but mine is stated as Gross acres:100 Net acres .10864198 Interest: 0.00108642% Flat rate payment: $500. For my part , I don’t know if its worth pursuing. Any advice would be appreciated. If this helps, there appears to be a large surface mining operation next to our property owned by Consol Mining which appears to also own 150 land acres above our 100 acres of minerals. Thanks for your time.
When you have a very small net mineral interest (like you do) and a company has offered to buy it from you, there’s a bit of a balancing test you have to do. The minerals will probably be worth more in the long run if you lease them and get a signing bonus and royalties than if you sell them. However, there is no guarantee that you will ever receive royalties, even if you lease them. Also, since you have a small net mineral interest (it looks like you have about 1/10 of an acre) you might decide that mineral ownership is more of a hassle than it’s worth. Getting $500 (or whatever you negotiate them up to) every five years to sign a new lease may not be interesting to you. Or it might. It’s up to you. If you do sell, don’t settle for the $500 they’ve offered you. Shoot for the moon and ask for $2000 or $3000. You’ll know by their response whether they are willing to move up much on the price.
Do you specifically practice in WV only – or do you also practice in southwest PA?
I only practice in West Virginia. If you call the office we can put you in touch with a lawyer who works in PA. 304-473-1403.
My father owns some mineral rights in Wetzel County, WV and he leased a portion of those rights to DAC. They want to extend the lease and have given him a lower offer for a bonus to extend the lease for 5 years. Apparently there is no drilling going on for this parcel. Can you tell me what the going rate is for bonus payments in Wetzel County?
Things are going for around $6000/acre in Wetzel County right now. Good luck, and call us if you’d like some help negotiating with DAC.
I really appreciate your site.
antero has reached out and is sending a packet offering 500 and 18% royalty for leasing rights on oil and gas inheritance I didnt know I had.
I dont know the size of my percentage of the property (probably pretty small) but once I do I can use the going rate of leasing prices to figure out if 500 and 18% are a fair deal.
Do you have any idea the going rate for leasing per acre up in Wetzel county?
thanks!
I would push hard for $6000/acre in Wetzel County. I’ve seen one lease go at $6500/acre recently up there. 18% royalty is good, but if they’re at 18% then they might go up a bit. Give it a shot. With a $500 offer, you probably do have a small interest. When you have a small interest I usually avoid arguing about a per-acre price and start talking a flat payment of X dollars. In your case, I think I would ask them for $3000 flat. Tell them your time is worth something, and you’ve had to spend quite a bit of it figuring out what the heck this lease is all about.
Hi Kyle:
On a new lease in Proctor District, Wetzel county, Landman put this paragraph in the Addendum of his first offer:
“5. SPECIAL WARRANTY TITLE: Lessor covenants that he is seized and possessed of the Leased Premises and has the right to convey it and warrants the title against the lawful claims of all persons by through and under Lessor, his heirs, successors and assigns forever, against the lawful claims and demands of all persons claiming under or thru Lessor.”
My 97 year old Mother is the Lessor.
I told the Landman we didn’t want to warrant the title. He said that this provision means that my Mother is only warranting title since she inherited the lease from my father on his death in May of 2011. Also, in writing, lessee stated their title research is responsible for who owed the rights up until my Mother acquired the mineral rights.
Tug Hill is the Lessee.
OK to sign?
By the way, your December 2, 2016 Blog article, West Virginia Oil and Gas Lease Basics was a BIG help! Tug Hill agreed to your other suggestions!
Thank you,
Clay McCaskey
Huntington WVa
I’m glad to have helped. I don’t like to sign a Special Warranty unless I absolutely have to. Tell the landman that you’re not a lawyer, that you need it simple, and that you’re relying on Tug Hill’s work to tell you that you own the minerals, not vice versa. It’s not right for you to warrant their work in any way. Call us if you want any more assistance.
My great grandfather has alot of oil and mineral right in the state of West Virginia his last Will states the the inhiertance is to ONLY go to direct decendants of his. My father was one and was getting his inhiertance check from the wellls. He passed away several months ago. My question is this his will is a one page will that simply states his wife my step-mother gets everything. Nothing else is said. Does this mean she also gets the inhiertance my great grandfather left? She is not a blood relative.
This one is more complicated that it seems. We should probably talk about it on the phone. I’ll need to know where the will was drawn up, where you father passed away, and I need to actually see a copy of the will. You should probably call the office and set up a time to talk with me once you have a copy of the will and can send it to me.
Kyle,
I am from Oklahoma so I’m aware that the laws may be quite a bit different. My father has been receiving many letters this past year from oil and gas companies stating he has mineral right in multiple counties in the state. He was unaware of any of this. He is extremely nervous about this whole situation and wants proof that he is in fact an heir. However we do not know the first thing about going to the courthouses to look for his heirs names and information. There is someone from his town with his exact name who passed away a couple years ago. He is certain they are sending this information to the wrong person. How often do the oil and gas companies get the mineral owner wrong? Also, he has already received a check from one company and sent it back because he is scared that if they do find out they made a mistake he will have to pay all of that money back. Since he has started ignoring their letters, they have started mailing everything to me, his daughter. We don’t have the capability of going to all the courthouses ourselves just to prove either way that he is or isn’t the mineral owner. It’s starting to become frustrating.
The companies definitely do make mistakes. It pays to be a little cautious. On the other hand, if they’re willing to let you sign a lease with a No Warranty of Title clause and a No Refunds clause, you won’t have to pay them any money back. That said, if it looks like you are dealing with (whether you own it or not) a lot of mineral rights you should get in touch with an Oklahoma attorney who deals in oil and gas. Give the office a call and we can help you find someone. 304-473-1403.
Do you have a general idea of the going price for selling oil and gas rights in the McElroy District of Tyler Co., WV? I was recently contacted about selling my 0.58 interest in 69 acres. They are not interested in leasing, just purchasing and the first offer they have given me is really pretty low.
I’d try to get them above $6000/acre. Tyler County is very promising for both the Marcellus and the Utica. So not only could they get a signing bonus, but they could get royalties from two good formations. It’s worth every penny of $6000/acre.
Hi Kyle. This is for TX, but just needing general info I think. My father inherited land and mineral rights in the 70’s. He passed in 1993 and me and my other 3 siblings signed a “Warranty Deed and Acknowledgment in Interest on Estate” conveying all real property and assets to our mother. It stated
“SUBJECT, However, to the following:
1. Any and all reservations of oil, gas, and mineral exceptions, covenants, conditions, and restrictions contained in the chain of title of said premises, including sales of reservations of oil, gas, and minerals.
2. Any visible and apparent or recorded easements, roadways, for roads or utility lines over and across said premises.”
Fast FWD to now…Mom’s in her 80’s and was approached by an oil company last month to sign a lease on her 87 acres. She did. The oil company has called me and at least one other sibling and is sending out a lease packet to sign. They said that us 4 siblings only had an interest in .37 of an acre. ?? We’re not understanding that, as we were under the impression that we conveyed all over to her except the mineral rights. In previous years, my dad had inherited property that we retained our interest in after we conveyed it over to our mother and his cousin to sell.
I know the law is different from state to state, but can you give any insight or thoughts on this or give us an idea of what kind of questions we should ask the oil co.? The man calling to get my address the other day asked me if I had any, but he couldn’t answer the .3 of an acre question and I wasn’t knowledgeable enough about this to know what to ask! Another concern we have, is despite us talking to our mother for some years, she never made arrangements as my grandmother did to put the home and property in anyone else’s name. Now she’s about ready for the nursing home and we’re afraid the state will take any and all of it. I want to do what is morally right and what I know my father would have me to do on this. Any advice would be appreciated. Thank you.
I won’t be able to give you specific advice on most of this. The rules affecting title to property are state specific, and so are the rules for transferring property and avoiding Medicare and Medicaid issues. You’ll have to find an oil and gas attorney in Texas (that shouldn’t be too hard) and an estate planning attorney in Texas. As to the .37 acres, though, the landman should be able to tell you how you got that. I’m a bit surprised he was unable to. Push him a little harder on that.
In the past 20 years or so, my wife and her family signed several division orders verifying their ownership share as stated by the operator on the division order submitted. They attempted no independent verification. Now I am researching deeds and finding errors that have resulted in underpayment. What recourse do we have?
The first step would be to contact the company and point out the mistakes you have found. They will usually work with you to get the ownership right. If they don’t, having an attorney take a close look at the situation would be the next step.
My father passed away in 2011 and there was no will he had some mineral rights in Brooke county wv, some time along the line my mother was contacted by a oil and gas company and in a spur of the moment she signed the rights over to a church ( no clue why) my question is that since there was no will should the rights have passed on to the children and not my mother since we are the blood heirs to the rights?
It probably all went to your mother. It’s hard to say for sure, because I just don’t know enough about your family from this conversation. If there were never any other spouses or any step kids or such things, then it most likely all went to your mother. I hate to give you my “final answer” without actually talking with you about it.
I inherited mineral rights on land that is now leased for storage and have been contacted about selling my rights. Is that a smart move?.
I never recommend that someone sell their minerals unless they have a compelling reason to do so, such as paying off debts, buying an investment they’re very confident in, or using the money to make a significant change to the quality (not quantity) of their life. However, it’s entirely up to you. There are a couple factors that apply to your situation that don’t apply to all. One, you won’t be receiving a bonus for a new lease since the old lease is kept alive by gas storage. I’d want to read the lease to be sure that they have the right to use it for gas storage, of course. Two, the old lease is most likely at 1/8 royalty, so you’ll never get more than that. That makes your mineral right slightly less valuable than some others. Good luck, and if you do decide to sell, we can help you navigate the process if you’d like.
Thank you, your reply has created more questions that I would like to discuss with you. I look forward to talking to you.
Kyle, Back in January a lease company approached my mother in law to sign a lease agreement… she was ill and told them to refer to her son. (my husband). The lease company made an offer.. we explained we are about to transfer the land to our name and will get back with them…There was a time limit and long story short we declined at that time. The company stated this, “we will be moving forward with development over the coming weeks, and unless advised that “mother in law” intends to execute the lease by tomorrow; will be forced to remove her acreage. This means, all acreage surrounding your mother’s property will be “held by production” which will severely limit your family’s ability to negotiate a lease in the future. In no way is this email meant to be a threat, only a final effort to explain what all is at stake for your family.”… Can you explain to us if this means we are “out of luck” at this point? We did reach out telling them we are now the new owners and are interested in looking at what they have to offer and have not had a response.
My fear is we missed the boat. Thanks, Deb P.S. This is in Ohio
You may have missed the boat on development of that specific formation. I think you understood what the company rep was saying: all the properties surrounding you would be developed, and you would be undeveloped. I’m surprised that they moved that quickly. Usually before writing someone out of a unit they’ll take more time, work with you more. One thing to consider is that they will probably end up coming really close to your property with a well bore. If they do, they may frack under your property. That’s probably not allowed in Ohio. It’s trespass in West Virginia, and may be in Ohio. You’ll have to consult with an Ohio attorney who practices in oil and gas. Call here if you don’t know one or how to find one. Keep an eye out for the well work permits around your property and find the maps to the wells. I’m not sure how to find that information in Ohio, as my focus is in West Virginia. Again, an Ohio attorney who practices in oil and gas will be more helpful.
In January we received a call from someone representing Antero advising that we may be receiving paperwork in the mail regarding a pooling agreement. Yesterday, the man called back and said we ARE going to receive this paperwork this week. Apparently Antero is buying current lease agreements that are HBP and then pooling them to make a unit. In this scenario should a bonus be expected per acre or can Antero drill without paying one if they purchase the original lease? Thanks! I’ll be forwarding the documents to your office for review once I receive them!
Where an oil and gas company is asking to modify an old lease that is kept alive because there is still production from the leased property, it’s still common to make an upfront payment. That is unless you are Antero Resources, in which case they expect to get to modify that agreement for nothing. Their argument is that you will benefit as much as they will because if the old lease isn’t modified then horizontal drilling is impossible. It’s an argument. You should take advantage of the opportunity. It’s not very often that an oil and gas company wants something from you. Antero won’t give you much, but you should at least be able to get a No Warranty of Title clause and an Indemnification clause and some money.
Received the documents today. Not much to them but I will forward them to you for your review and advice. Thanks!
Does a $3,000 bonus and a 15% royalty on a 0.66875 interest in Pleasants County sound like a good offer? (Land Track #P7220D, Union District)
Your blog has been very helpful, thanks very much!
That’s not too bad. I’m going to assume the $3000 is a flat fee, making it about $4500 per acre. That’s definitely good. The 15% royalty is not great, but if they’re only after dry gas they may not move much on that. Find out what they expect to get out of the well. If it’s wet gas push for 18%, and if it’s dry gas push for 16%. Always try for no deductions, of course. Good luck! Call us if you’d like any help.
Hey Kyle, thanks for your help. To be short and sweet my father revived a letter a few years ago from a oil company stating that his father left his mother, two sisters and him each a percentage of mineral rights in Mississippi, no one new he even had these to leave to them. While my dad is interested the other family members said they spoke to a lawyer one time and the lawyer told them if they signed the paperwork then they may be liable for property taxes. While I don’t think this is true, they don’t own the land just the mineral rights. Now no one else wants to sign the paperwork. What would be his options, secondly as my father stated he will leave the rights in my name in his will, after the other family members pass can I go to court and try to obtain there share?
That’s going to be dependent on Mississippi law. Here in WV I could work you through this, but Mississippi could be entirely different in every way. It looks like Bartlett Law does work for the landowners. And William F. Blair has worked in the industry, but probably knows some good oil and gas attorneys who work for landowners. We haven’t worked with or endorse these lawyers and law firms, their names just popped up on Google. Good luck. It’s hard finding people who do what we do. You could also get on mineralrightsforum.com and shaleforum.com and see if you can find some lawyers on there.
Kyle,
We have a OGM lease with Antero that looks like it will expire this summer before drilling commences as they have not applied for a permit yet. What is the exact point in process that defines “drilling operations” as described in lease:
a) as long thereafter as oil and gas, or either of them, is produced from the land or from lands pooled therewith, or drilling operations are continuously prosecuted as hereinafter provided, or this lease is otherwise maintained in effect pursuant to the provisions hereof;
and how would a lease renewal work? There is a right of first refusal clause. The initial lease was for $2,500 an acre and 16% royalty. If Antero chose to renew would that be renegotiated? Acreage in Clay district, Ritchie County close to Beason Run.
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Hi, I have been contacted by Antero that my father inherited a share of my grandmothers mineral rights in Tyler county. He was married at his time of death but they were separated for more than five years. My father past away in NC. I want to keep these mineral rights in the family. But most of all want to make sure me and my sister, worst case scenario be at least sharing this three ways if I cannot convince my stepmother to give her share to my brother, who is a stepson, my half brother. I don’t even know the value or any information as they haven’t really answered any of my questions.
That’s a tough situation. Most likely you and your siblings will share 1/2 of what your father had. It could end up being split differently once all is said and done. If Antero is working with you that usually means they believe that you own part of the minerals. Minerals in Tyler County, WV are pretty valuable. You probably own a pretty small part of a larger tract, but even a small mineral interest is worth something. Let us know how things work out.
Sir: Tax Question…..Small producing well…..2 tanks a year…..Check rec. in November of 2016. All well owners were paid. We reserved $1700.00 for expenses for the next 6 months. (Inc. $1200.00 for the well tender.) At the end of the year, this money the $1700.00 shows up as not being spent but we have saved it for 2017 expenses. Do we have to pay income tax on this money or is there someplace we can list reserved for expenses? What form do we use. This money will all be spent in 2017.
I’m afraid specific tax questions are well beyond the scope of what I do. You’ll get a much better informed and faster response from even a newbie CPA than you will from me. Even off-the-shelf tax software might do a better job than I will on this one. Sorry to not be of help on this.
Kyle, need some guidance I was informed a couple of years ago that me and some other family members inherited some mineral rights I never signed anything as they offered 25.00 signing bonus in the beginning but up to 500.00 in September of 2016, I received a call yesterday and I spoke to Steve from EWR about cutting down trees so that they can build the plat?? I told him that I hadn’t signed anything he told me if a percentage of the heirs signed it doesn’t matter, need some help please.
Thank you
It does matter, unless they are developing Utica. Then they have forced pooling ability and can develop without permission. The surface is still something they need to work with you on. There are quite a few details that might change this answer, unfortunately. Sorry to be of so little help on this one.
Kyle, My family hold validated mineral rights to 377 acres in Ritchie county, which has six poor producing wells dating to 1978. They have not been maintained properly and the lessee has defaulted on lease payments for an extended period. The suit to terminate is being launched, When the lease is terminated what will the status of the well equipment and infrastructure? What is the best approach to get an interim operator to continue while a long term lease is negotiated? What should one expect from a clear title 377 acre tract in Ritchie County today?
You mentioned that a lawsuit has been started so I assume you are already represented by an attorney. I recommend you talk with your attorney about all these questions. If your attorney wants to talk with me about some of them, then have him/her reach out to me. Sorry I can’t be of more help than that, but it’s better this way.
Hi Kyle,
My mother and father passed away and we are trying to determine how we can handle their oil and gas leases. I will give you as much information (probably more than you need) as possible. They have oil and gas leases in several counties and placed them into a marital trust. Upon my father in laws death the marital trust was closed and moved to an irrevocable trust. My mother in law was the trustee/beneficiary and with my husband and brother in law as the beneficiaries upon her death. She has now passed away and we are dealing with the trust. Since it is irrevocable can we remove the assets? Also we have decided, for ease, to split the oil and gas leases by county verses dividing the properties. Do we need to have them gift the properties?
Any help you can provide would be greatly appreciated.
While your question involves an oil and gas interest, it’s not actually an oil and gas question. It’s a question about trusts. What you can do with the trust assets will depend on the law of the State in which the trust is organized. Once you have figured out what you can do with the trust assets we can help you create deeds and work with the various county clerks to get the ownership into the right names, if necessary.
I recently received a lease offer with a signing bonus of $1250/net acre for my 0.48 net acres. This is in Doddridge county and seems kind of low to me from what I’ve been reading here. The royalty was 15% which I gather is pretty standard. Does this sound at all reasonable?
That is a low offer. I suggest trying to get them up to $2500/acre and 18% royalty. Ask for more than that, of course. You have to build in some room for them to negotiate you down. Ask for $4000/acre and 20%. It’ll be interesting to see how they respond. They won’t walk away from the negotiation. They’re used to people asking for a lot.
I have 3/10 of an acre leased. Can I sell the rights?
Yes you can. You can find quite a few companies online. All trying to buy up mineral rights. You could also call the company that holds your lease and see if they want to buy it.
Hi,
My great grandfather left land to his whom are now decease as well as my grandfather , his siblings, and their kids. A lawyer from Entergy called saying there’s a gas line on the property that needs to be replaced. He said all living descendants will receive $100 minus interest( one time payout) for leasing the property. This doesn’t seem right. If they are leasing the land shouldn’t there be monthly payments? He said this gas line runs from one city to another, there may be an old lease agreement I don’t know if so why we haven’t been receiving royalties. It seems as if we are being cheated and mislead. I’m in Louisiana,. can you tell what steps I need to take to get to the bottom of this
You’ll need to get a copy of the old lease and any other documents that might create an ownership interest for the company, such as an easement or right of way agreement. Then you’ll need to get an attorney to read it and determine whether the company has been following the agreement or not.
ok so as of a week or so ago I was contacted by eqt about rights I am heir to? being from a city I am lost he mailed me the lease it says clay district Ritchie County wv and it also says it contains 160 acres this is all French to me. I am assuming I need a lawyer? Because it seems thee are so many unanswered questions and I live in Akron Ohio So do You do consults over the phone.
You should find out how large your ownership interest is. All the other heirs to whoever you inherited those minerals from also own some part of that 160 acre tract. If you own a large fraction of that 160 acres, then you’ll be able to have some fun negotiating with the company. If you just have a small ownership then you will be able to make some changes to limit liability and make sure you don’t have to return any money to the company if they change their minds later about whether you own these minerals. Either way, find out how many acres you own, give the office a call and set up an appointment to talk with me.
Hi, Kyle
How do you recommend negotiating an existing lease that needs to be ‘amended’ for shale drilling? We currently have a vertical lease with Atlas Resources/now Viking and Chevron has approached us to get an ‘amended’ lease to include the entire property instead of just 1/4 of the acreage Atlas had yet they don’t feel they should offer a signing bonus and think the 1/8 royalty is “more than fair”. I think they are trying to rip us off but am being pressured. Any suggestions? I’ve tried to retain an attorney but they are so expensive and all want big retainers – and I’m almost out of time. If you can negotiate in the state of PA – and are reasonable in your costs – I would be more than happy to work with you as I can see how caring/helpful you are. Please let me know ASAP! Thanks. HG
1/8 is “more than fair”? Sheesh. They can do better than that. They’re just posturing for negotiation. Definitely talk with an attorney. I am not licensed in PA, but call the office and we’ll send your info to a guy we know who is licensed up there.
Hi. My mother-in-law recently received a phone call from North East Natural Energy regarding land in WV that, apparently, her recently deceased husband is an heir to. I am planning on speaking to the landman who works for the company tomorrow. This is land that we knew nothing about up until about 3 days ago. I’ve been trying to reasearch this for the last two days. Are their specific questions I need to ask or specific things I should be listening for in our conversation? Thanks!
Yes, there are some questions you should ask. First, find out how many net acres you own. You inherited this interest from someone who passed away a long time ago. All of that person’s heirs have an interest in the property. You should find out how large your share is. That will dictate some of the decisions you make going forward. Second, find out when the company plans on drilling on the property. This might be difficult information to get because the company might not have plans that are more specific than “fall of 2018”. It’s worth it to ask, though. You might also ask where the property is located, if that’s something you’re interested in. Outside of that, the landman will tell you how much they’re going to pay and anything else that might induce you to sign. The landman is usually an expert in oil and gas, and will be willing to educate you if you’re nice and ask lots of questions. For the rest of the story, give the office a call and set up an appointment to talk with one of us. Good luck!
Hi… My son and I share 3 acres in the Bakken Formation in North Dakota. When we signed our leases, we were promised 20% of the oil profits, but instead we get .00013009. They have pulled out at least 40 million dollars of oil and we’ve been given checks totaling about $5000. It seemed like the lease was pretty straightforward so I don’t understand how we can be getting so little in royalties.
It sounds like they’re taking out post-production costs. I’m not familiar with North Dakota law on the subject. I couldn’t say whether they’re allowed to do so or not. A quick Google search turns up Johnson and Sundeen, who might or might not be conflicted out from working for you. The larger firms will almost always be conflicted out as they almost always have done title work and litigation for the oil and gas companies. Howard and Associates could also be an option. There may be others that you can find by asking around.
Kyle
This is a question I would think lot’s of mineral owners would like cleared up if possible. How do you go about getting heirs in a tract to pay their share of mineral property taxes? Since there is only one tax ticket and the county does not sort the owners out, this has become a real issue. The person who has the ticket pays and pays and no one else does. Can a lien be placed on a non paying heir in Wv? Getting the interests separated is a long process and should have been done many years ago. The courthouses don’t want to get into separating tickets for each heir so, they are content as long as someone pays them. Thanks
The only way I know of is to get the interests separated out into their own tax tickets, as you alluded to. You might be able to get everybody to put their interests into an LLC or a trust, and then the income from the minerals (if there is some) could be used to pay the taxes.
Hi Kyle. We leased our land (in Louisiana) to Memorial Resource Development (now bought by Range Resources), but aren’t being paid what the market says we should be. For instance, in June 2016, we were paid $2.10, whereas the market says the price never went lower than $2.60. That’s on top of production and transportation costs which we also pay a part of. Anything we can do to get paid market value? Thank you so much for your time.
I don’t work in Louisiana, so I don’t know the legal issues in play. You should find a Louisiana attorney to look at this for you. The question is going to be whether the company can deduct post-production costs, most likely. However, your local price for gas may vary from the posted Henry Hub price. It’s hard for me to say because I don’t keep track of that stuff. It looks like BKC Law does work for mineral owners, and Veron, Bice, Palmero and Wilson seem to as well. I haven’t worked with either, in fact I’ve never even spoken to them. I just took a quick look at their websites to see whether they talk like they work for companies or for people. I can’t say whether they will do good work for you or not. Good luck.
I own minerals rights in ritchie county and in doddridge county can you tell me what they might be worth I have people calling me all the time it would be nice to know how much it might be worth. The land is under lease and has wells on it. Thank you
I assume you mean in a sale? That’s a little tough, but I have talked with a landman in the last two months who put together a sale on his own mineral rights (with a company he didn’t work for) for about $5600/acre. His minerals were in Ritchie County. They may have been unleased, so you could take $1000/acre off that price for you leased property. If it starts producing, though, you could get a lot more than that in royalties, so it might be better to hang on to it. Call the office if you want to talk the decision through with me. 304-473-1403.
Thank you so much for your site. I feel better versed in this than when I first got that call. I’m being offered an approximately $4500 signing bonus and then 15% royalty if they drill on 57 acres in Marshall County, WV, by Chevron. We own 50 percent of the mineral rights on this property. I believe the rep said this would be based on my share of 1.478 acres. (Lot of heirs in this one.) This is a 5-year lease with the option to renew. I saw that someone else mentioned that you don’t love these 5+5 leases, but I couldn’t find any article regarding that. The guy said this was the going rate there so I’m just curious what your take is on it before I sign anything. I don’t have the lease paperwork yet; it’s been put in the mail to me.
We’re glad to help people out. You’re right, I’m not a fan of an automatic extension of the primary term. There’s just no way that you can win. If the company is still interested in your property in five years they’ll pay you the same signing bonus that they will pay you this year, but only if the going price is about the same or more. If the going price has gone down they’ll come back and say your property isn’t worth what they paid before, but they’ll pay you a much lower signing bonus. The royalty they’re offering is low, and if they’ve offered $3000/acre then they’ll probably pay more. Work them up. If you’d like more help when you’ve received the paperwork, give us a call and we’ll figure out what we can do for you.
Hi Kyle,
I own 20.88 acres including the mineral rights in Doddridge County, WV and was recently offered $1000/acre bonus and 16% royalty do you think this is a good offer or could we negotiate more for the bonus? Seems rather low to me. What would you suggest is a good bonus amount per acre at this time?
Thank you
That’s really low. Prices aren’t what they were two years ago, but you should be able to get them to come up on both those numbers. I haven’t seen a lease completed in Doddridge in a while, but I would say getting $2000/acre out of them shouldn’t be out of the question, and I think 18% is still a reasonable royalty. Call the office if you’d like more help, particularly if you own surface rights. You want to do whatever you can to keep them off your property, or at least keep them on the part of the property they say they’ll actually use. 304-473-1403.
My mother in law has approx. 78 acres in Ritchie County, Clay distict. This is the net acreage of the land, so she is entitled to 100% of the 78 acres. She has been contacted by a company out of Oklahoma called Redstone Resources LLC to purchase the mineral rights. Can you confirm if this is a legtitmate company. They are offering $3K per acre. Good or Bad? in your professional opinion what would be a fair and equitable counteroffer from her back to Redstone, assuming they are a credible company.
I certainly wouldn’t jump at that offer. Two years ago, when they were leasing at a fast rate, you could negotiate up to $3000/acre for a lease. If (when) things start to pick up a bit you’ll probably be in an excellent position. Now, if you just need some cash now then selling is certainly an option. I haven’t dealt with Redstone Resources, but they’re probably legit. If you are concerned about getting taken, we can broker the sale for you. We’ll hold onto the deed until their check clears our bank, cut you a check and send them the deed. I certainly wouldn’t sell for $3000/acre. I talked with a landman who was selling his for $5600/acre in Ritchie County about a month or so ago. Gas prices have stabilized at $2.75/MCF since then, and I expect them to go higher in the near future. You can probably get more than $5600/acre if you push them hard and they’re really interested in your property. Also, I’ve noticed that mineral buyers tend to be just a few steps ahead of the lease buyers in most instances. Not all, of course. I can’t guarantee that there’s a lease coming your way within the next couple of months. It’s just something I’ve noticed with a few of my clients lately. They’ll call and say they have a lease in hand and that they had an offer to buy within the last few months. But there is also the old saying that a bird in the hand is worth two in the bush.
I own 20 acres of minerals in Weston County, WY I know the minerals are worth millions ( how many millions?) I want to sell my minerals to a mineral company how much money realistically can I receive? I also have 60 acres of minerals in TX how much are these minerals worth? How many millions?
I don’t work in Wyoming or Texas, and I really can’t venture a guess as to how much your mineral rights in those states are worth. If it’s anything like West Virginia it’s going to depend a lot on the exact location.
Hello, My husband inherited 1\2 oil/gas rights on 95 acres in Ritchie County, WV. Since this has happened, we are continually getting offers to purchase these rights. Not knowing much besides what we’ve read, it seems better to lease with a gas company than to sell. Do you have insight on either? If we do sell or lease, what would be reasonable offers to consider in this area?
I generally recommend that people hold on to their minerals. Here’s an article I wrote on the subject. http://www.nuttalllegal.com/category/selling-minerals/ Prices are a moving target, but right now a lease in Ritchie County should get you north of $1500/acre for the bonus and around 18% for the royalty. A sale in Ritchie should get you over $4000/acre, probably even above $5000/acre if you find the right company.
Chevron contacted my family about some land we own mineral rights to in Doddridge County. We finalized the leases and half received the up front payments, well come to find out the land was already being drilled on by Console, and has been since the 60’s-70’s the well is still producing. Our lease with Chevron was terminated and Console has taken over. Anyhow, Console is saying that the land will pay us a flat rate royalty. Is this typical, can we go after them for more money? We are waiting to hear from their land records group….just wanted to see if you had any info in the meantime!
Older leases often used a flat rate royalty. However, in the 60s it’s more likely that the royalty would have been a percentage instead of a flat rate. You’ll have to look at the lease to be sure. Consol should be able to provide you a copy of the lease. Also, there should be some back royalties due. If not, you’ll have a good argument for terminating the old lease. Let me know how things go.
What happens in situations where an oil and gas company would sign a lease with a person who they thought was the rightful heir but years later find out that the previous family kept the mineral rights?
Like so many other situations that we see, it depends on some other things. If it was a lease with a large bonus payment and large royalty payments, the company may try to force the person who signed the lease to pay that money back. However, if the money paid out was relatively small (thousands as opposed to tens of thousands) then they probably will just make a phone call or two trying to get the money back and when they’re unsuccessful, they’ll let it go. Also, if there’s a No Warranty of Title clause in the lease it won’t matter either way because a good No Warranty of Title clause will make it so that all the risk of entering into the lease falls on the company.
Kyle, I received lease documents in the mail from Richard Swiger representing Antero Resources as a landman, that I own one eighth (12.5%) royalty and they are amended to read Seven-Fiftieth (14%) royalty. My other 2 brothers and sister also received the same offer. They are offering 250.00 for a 5 year lease. I am wondering if this is legitimate. Enclosed in the lease packet is a w-9 form which would need my social security number. I am concerned that this could be some sort of identity theft scam. Have these type of offers been issued for such business in West Virginia or is this a scam.
Antero Resources is a real company, and I have heard the name Richard Swiger before, but I haven’t dealt with him. If you have any concerns regarding whether it’s a real offer you should look up Antero’s Denver offices online, call them, and ask them to confirm that Richard Swiger is their landman. They will most likely transfer you to their Bridgeport, WV office and you’ll be able to talk with someone there who will be able to confirm the validity of the offer. It’s standard practice to include a W-9 with a lease. They need your social security number to report to the IRS who they are paying royalties to. Without your social, they will withhold 28% of your royalties and pay that as income tax on your behalf. That won’t get you out of paying the correct amount of income tax, however, so filling out and returning the W-9 is generally going to be in your best interest.
Kyle, I hope you’re doing well. I saw my name mentioned in this thread and wanted to remind you that we worked together late 2014 with the Masterson family. That way if anyone in the future asks you for a reference of me you can tell them how nice I am to work with…. Lol. I hope you’re doing well and thank you for helping Greg and his family!!! Take care!!
I’ll make sure to do that. I am doing well, I’m actually getting over a cold so I’m feeling much better than I was yesterday. I was glad to help you guys out. Hope the family is well. You take care too!
My family received an offer from EQT to lease a 50 acre tract which is located in Union District,Tyler County. The Landman said the family owns 50% interest in the tract and is offering $16,000 bonus and 1/8th royalty for a 5 yr term and 5 yr extension option. This seems low. Your thoughts?
Those prices are definitely low. The bottom has dropped out of the market, but it’s coming back. If they’re not willing to work with you at a higher price and bonus then you probably should just tell them you’ll wait until later. Tyler is a good county to have mineral rights in, by the way.
Hi,
My grandparents signed a gas/oil lease on 87 acres in monongalia county in 1946. It was a ten year lease with “with the extension of term by payment of rentals as hereafter set forth.”. This last year my family got less than $40 from this lease. How difficult is a least set up this way to get out of and what would be a fair lease for that many acres in this area? I have no idea what kind of payments and royalty to expect.
Hi Julie. That lease is most likely being held by production. In other words, it’s still in force because there is something being produced from a well or wells on the property and some language in the lease says that as long as there is something being produced it will remain in effect. As long as that is the case, there’s not anything that can be done to have the lease declared forfeit, expired, etc. Now, if you can show that there is no production and that they have otherwise violated the terms of the lease, it may be possible to “kill” that lease.
So they can actually have an indefinite lease – with no way of cancelling it because of them giving less than $50 a year for over 87 acres? Usually after a term in most property rentals the landlord can terminate with notice. Why can’t we just give them notice that after this next payment we are not extending? (Thank you for taking the time to respond!)
Yes, that’s the way it is with most contracts. You can’t just get out of them. A residential lease is different because of state law, usually. Because so many people are impacted by residential leases, state law has modified common law to allow for easier cancellation. Oil and gas leases are still affected by common law. Common law doesn’t allow for forfeiture (cancellation) of a contract outside of pretty egregious abuse of the contract. I’m doing some research right now that might prove useful for cancelling oil and gas leases, but where payments are being made as per the lease, it’s still not going to be possible to get it cancelled.
I was just offered $40k to sell my 26 acres (mineral rights) in Marion County. I have an existing lease on the mineral rights. Is that a good offer and does the fact that I have a lease have any effect on the sell if I decide to sell.
The fact that you have a lease on the property is actually good in the eyes of some buyers. They figure that someone else has done the title work to determine that you are the owner and they won’t worry about title work of their own. That is a significant savings to them. However, they are buying your mineral rights at $1,500 per acre. That’s not a very good deal in the long run. Keep in mind, of course, that if you need cash now it’s a great option for getting it. If you do sell, make sure to keep some of it back to pay taxes. You should also consider how it’s going to affect your taxes in general. Here’s a blog post we wrote about some things you could think about when you are deciding whether to sell. If you decide to sell and want help closing the deal, give the office a call.
Thanks you for your response. I just pulled out my leases and see that the 10 year term has expired recently. There is a clause that state they may extend it, but I have heard nothing from Chesapeake. I’m assuming I can re-lease in that case. If I sell, I will be in touch with you.
That’s great! Check some of the other clauses, too. Sometimes one of them will give the company 120 days from the expiration of the primary term to send you a check to renew. Let’s hope not. Let’s also hope someone offers you a new lease. Marion County was never a hot spot, but it also doesn’t seem to have died off completely. Keep me updated.
I recently received a phone call and documentation for a quick turn around in Doddridge County. I just found out I inherited mineral rights to 0.083333 of an acre and they are offering $500 bonus for a 5 year lease & 15% royalty. What are your thoughts?
The deadline is not something they’ll enforce if you’re communicating with them. They provide a deadline to encourage you to sign the lease quickly and to make sure you don’t hold on to it for a couple months, see that the market is going south (it can’t go very far south right now) and try to force them to honor their agreement. The $500 isn’t a bad offer at all. Typical bonuses in Doddridge County are between $2000 and $3000 per acre. Where you have under 1/10th of an acre and you’re getting $500, that’s just north of $5000 per acre. However, I’d ask them for $1500 and see what their response is. I would also ask for 18% royalty and be pretty firm on that. Also try to get a No Warranty of Title clause, an Indemnification clause, and a Gross Proceeds clause. If you’d like some more personalized assistance, give the office a call at 304-473-1403 and talk with my secretary about getting an appointment. Best of luck!
Thank you Kyle for the advise. I will contact your office if I need assistance. Thanks again for the quick response.
I own property on Roberts Ridge. It is connected to the Berger well which is supposed to be one of the richest wells in Marshall county. It has been drilled and fracked with our understanding. We have been told that they are sitting on the gas and not pumping until gas prices go up. Our lease expired in Nov. of 2015 without us receiving any monies for renewal of lease. Are these wells usually permitted to sit on the property without paying royalties or renewal lease fees once the wells are drilled and fracked, and if so, how long?
Great question! The answer is going to depend very much on what the language of your lease says. Most likely you are going to need to read the shut-in clause very carefully and apply that to your situation. If, for some odd reason, your lease doesn’t include a shut-in clause then you’ll have to take a look at the rest of the lease to find provisions that would apply. It’s time to find a nice hard chair, some really bright lights, and your favorite pick-me-up drink (I’m a hot chocolate guy) because reading these leases is extremely boring for most people. I’m one of those weirdos that actually kind of likes it. Best of luck and give the office a call if you decide you need help.
Our chevron mineral lease in Webster District, WV is up in May 2016. What is a good lease amount for our renewal ($ per acre), and any royalty % – we have not received royalty $ yet, but since it will be a new lease, wanting to make sure that we have everything covered. In reading your column, I noticed you are not recommending 5+5 year leases. Any other suggestions appreciated.
I’m going to assume that’s Marshall County, WV. If that’s the case, oil and gas leases up there are starting at about $3,500/acre and going up. Companies are excited about the Utica right now, but they’ll become interested (again) in the Marcellus when we get some more processing capability in the region. The amount you can expect for a lease will vary based on how large your net mineral interest is, how prolific they expect your property to be, and whether any other companies are interested in your property. Good luck.
As stated above, our lease expired in May 2016 . . . we haven’t heard anything more. Chevron purchased our lease from Chesapeake. What and when should we expect to hear from Chevron. Are they typically on track and timely with regard to renewals?
I can’t say how timely Chevron is with renewals as I haven’t seen any from them yet. You lease may give them a grace period in which they can renew. Read it closely to see if you can find anything like that. If there’s not you should send them a request for a release of the lease (not renewing the lease, but letting it go). They should provide you one which you can then file at the courthouse. If they don’t you’ll want to file an Affidavit of Non-Payment and Non-Production, which my office can provide you. 304-473-1403 if you need it. Best of luck!
We will receive our first royalty check. We have to deposit half in our children’s account because of a divorce decree. Will we be taxed on their half? If so, what is the best way to deposit their money? 529 or savings?
This is really a question for a CPA or a tax attorney. Unfortunately I rather detested my personal income tax class in law school. I can take a quick stab at answering part of your question. Since the income is coming through your hands you will probably have to pay income tax on it. If there’s something creative that you can do, such as your suggested 529, maybe you can avoid having to pay tax on it. Find a good CPA, tax accountant, or tax attorney and let them steer you in the right direction. If you’re in WV I can make a recommendation. If you’re in another state and want some help finding someone, email me and I’ll do what I can to find someone for you.
I am so glad to have found your site tonight. My father has leased his mineral rights in scurry county, Tx. He has been receiving royalties for over 25 years. Upon his death he left to his 9 children. Good Catholic, yes. we have already handled dealing with Kindred Morgan and they issue monthly checks individually. Of course lately due to pricing we have not received a ck since November of 2015.
I called the other day and was told they do not issue cks for under $100. I can understand that. Average pmts have been around $248 per child, a month. Novembers, was $108.
My question is I asked to see a copy of the lease terms so we could better understand how all is set up. The woman I spoke with in billing said that was a great ? she did not know. Thought that was a bit weird. I guess being self employed all my life if there is one thing I know is where my money is and where it went!!!!!!!!
Anyhow, could you kindly explain how we might go about getting a copy of the lease and how to ask for it.
Thank you so very much
I’m not licensed to practice in Texas, so I can’t speak authoritatively to you question. In general, you should be able to find a copy of the lease in the courthouse. If not, you can ask the company to provide you a copy. If they balk at that, it will be time to hire a Texas-licensed lawyer. Best of luck.
Hi Kyle,
My father owns 14 acres of surface & mineral rights in Barbour County and has passed away with a will. He was divorced at the time of his death and there are 4ea. adult children. In the will besides some personal property he left the property and and all of his estate to one of the children. It does not mention anything about the minerals or royalties in the will. My question is are the royalties and minerals split between the 4ea. children or does it belong to the 1ea. that inherited the property and estate?
It’s going to depend on the actual language of the will. Without having an opportunity to read the will I wouldn’t want to venture a guess. I’m sorry I can’t be of more help here on the forum with this issue. Call the office if you’d like to have me read and interpret the will. 304-473-1403.
My father received a lease in for 143 acres left to him from his father if they find oil or gas he wants me his son to collect His roality checks on his behalf what do I need to do to make this happen he sent me all that papers that he received also.
Check the lease to see whether there are requirements for changing the payee. If not, call the company and see what they need you to do. If you need help after trying those things, give the office a call at 304-473-1403 and we’ll figure out how to help you.
Hello! I know you are in WV, but, I need help with an Oil and Gas mineral lease in Tx. Is there someone you could recommend I talk to for Pecos County? I want to negotiate the Bonus rate on a lease offer. Thank you so much.
~Alisia Silliman
It took a while, but I’ve finally found someone who might be able to help you. It’s not an attorney, as the attorneys I called around in Pecos County didn’t seem to do oil and gas or know any attorneys who do oil and gas. If finally was able to get a referral from the office of Frank Lacy to Darren Hodges. Darren is a lease broker in Fort Stockton, Texas. He said I could put his phone number here. It’s 432-336-3309. He said he should be able to help you, and if he couldn’t help you he could find someone who would. Sorry it took so long, but I waited on a couple of people longer than I should have before looking farther. I hope this helps, and if it doesn’t, please let me know.
My Brothers and I own the Mineral tights to small portions of several plats in Wetzel County, WV.
They are currently leased but some brothers desire to sell their rights.
What are your thoughts as to the timing of this? Any guess at current $/acre?
Also, are there WV taxes on the mineral rights themselves? If so, we may ow back taxes. Comments?
Tom
You couldn’t be selling at a worse time. I think that oil and gas prices have bottomed out, or pretty nearly bottomed out. Of course, I’ve been wrong with oil and gas price predictions before. The real question to answer is, “do I need the money now or not?” If you need the money, then sell. If not, wait. I Wetzel County you should really try hard to sell for $6,000 to $8000 per acre. Nobody wants to buy for that, but they’re worth it. Shoot, they’re really worth more, but if you can find someone willing to buy for more I’d love to meet them. Regarding the taxes, you need to check to see if the minerals are listed on the land books. If they are then you or someone will be receiving a tax ticket for them. If they are listed in someone else’s name, then you should really have them transferred to your name so that you can have control over whether the taxes are paid. That will take hiring a landman or attorney to do title work, and an attorney to draft the deed. If they’re not listed, you should consider getting them listed, again so that you have control over whether the taxes are paid.
Kyle I just received a lease to sign in Marion County WV. The bonus money is $100.00 which is way low as you know and I require more. The offer came from EXXON XTO which is drilling Marion County now. They offer 12.50% per year for 5 years. How do I go about asking for more up front bonus. I am thinking 700.00 top 1200
51 acres and almost 55 heirs involved.
So none of the heirs probably have large interests. I’d say that in Marion County you should be able to get up to $1500/acre, so ask for $2000 or $2500 per acre, depending on how bold you are. That’s if you have more than about a tenth of an acre of course. When you get down that small you will want to ignore the per acre figure and talk about a flat bonus amount. You’ll usually end up getting more that way. Call the office and talk with one of the front office people if you’d like a little more help. 304-473-1403.
We have recently been offered $9,000 per mineral acre in Marshall County, WV and Greene County, PA (approximately 70 acres). This seems a bit low. What do you think?
That would be a great price for a lease, but just a reasonable price for a sale. That’s particularly true if you own all of the mineral rights under that tract.
My brother and i probated our great-grandfather’s estate in Wetzel Co and inherited mineral rights. Do we need a lawyer to file the new deed or can we do this ourselves using forms on deeds.com. The mineral rights has a 100 year old gas and oil lease in place and 5 gas companies have utilized this lease since 1980 per EPA records. Do we contact the gas companies for royalties owed to family .
Good question. I always recommend you hire a lawyer. Of course, I am a lawyer, and I make my living by helping people, so of course I would recommend you hire a lawyer. While you can use forms on deeds.com, you should at least spend some cash making sure you didn’t miss anything. Regarding the royalties, you’re on the right track — contact the current producer to see if you can recoup the back royalties. If you find yourself having trouble navigating the bureaucracy, give the office a call at 304-473-1403.
I have 30 acres of mineral rights inherited by me and my brother. What can we expect to receive for a gas and or oil lease on the Marcellus Shale in Wetzel County at this time (10/2015)? What should we expect to receive on the Utica Shale gas and or oil lease? Can a 100 year surface gas lease be updated (redone/negotiated) from $100/yr? Originally $300/yr, it was reduced to $100/yr 75 years ago due to low production but its no low now. What is your going rate to represent a mineral rights owner?
You should be able to get upwards of $4000/acre in Wetzel County. If you own all the minerals under all of the 30 acres, you should be able to get substantially more. I’ve heard of as much as $7000/acre. If the 100 year lease is still in effect you’ll have a hard time getting any changes made to it. If the company wants something you have, then you might be able to get some changes made to the old lease. My rates change periodically. Mostly they’ve been going up as there are more and more people in need of a lawyer who does only oil and gas, and I only have so many hours in a day. Call the office at 304-473-1403 and someone will help you out.
My father-in-law just got an offer (July 2015) in Doddridge County WV for a five year lease….7.6 ac. at $1500 per acre and 15% royalty. Term 5 years. The company is Antero.
Is that around the going rate in Doddridge?
Any input suggestions appreciated as we are new to this.
You can do better than $1500/acre in Doddridge County, WV right now, even though gas prices are down. I can’t see any reason why you couldn’t negotiate up to $2,000/acre, and probably even $2,500/acre. You can also get 185 gross proceeds on the royalty.
Just received a lease for 30 acres in Ritchie county, Dog Comfort Run, Grant District, $1000 bonus per acre and 15% royalty. Is this good or bad??? Not from that area. Just found out we inherited the mineral rights (not the surface).
Regards
Furrd
That’s a low ball offer. You should be able to negotiate them up to about $3000/acre in Ritchie, and 18% gross proceeds on the royalty.
Kyle,
I would like to talk to you. With your permission I will call you tomorrow to discuss possible representation.
Regards
Don Furr
Of course! I’ll be out of the office from about 12:00 to 4:00 today, but you can set up an appointment if I’m not there.
My wife recently found out that some of her royalty check we’re going to the wrong address. We later found out that some has forged and cashed these check. The check were for around $6000. We contacted the company trying to recoup these royalties but the company is refusing to send out new check. Most recently they have advised us that we need to find who stole our money and get it back from them. I don’t know what else to do. What can I do to have them pay us the royalties that are owed?
Well, that’s not a whole lot of information to go on, but I’ll run with what you’ve provided. If the oil and gas company was sending the check to the wrong address, and it was their mistake, you can probably have them held liable for it. I say “probably” because nothing is certain when you start dealing with oil and gas companies and getting them to pay up again for something they think they already paid for.
The company is correct that you’ll need to find out who cashed the checks. Whatever jurisdiction you’re in it’s a criminal offense, and you’ll need to get the prosecutor involved. If you want to leave the prosecutor out of it, you’ll have to hire an attorney. There’s going to be some legal wrangling involved. It may be a federal offense, since the person cashing the checks has opened your mail, and the feds have jurisdiction over mail. I’m not sure the feds will want to get involved because the amount is probably smaller than they usually deal with.
That’s the best I can do with what you’ve provided. It may be wrong or may be right, depending on the rest of the details. Consult a local attorney. Good luck.
My family is not the mineral rights owners to a tract of land in WV. A large gas company wants to store millions of barrels of water underground on our land. They are offering .02 a barrel! Is that a reasonable offer? Thanks in advance for sharing your thoughts!
I’m going to assume that .02 means 2 cents. That’s $20,000 per million. That adds up. There are a few questions to answer, though. How long are they going to store it? How do they calculate what they pay? How long will the agreement last? What kind of surface use will there be? Will trucks be coming and going, or are they going to use a pipeline? If there will be trucks, will they do noise and dust abatement? How many dollars per month/year will this equal? I bet there are a lot more questions to answer once those are answered, too.
My great grandfather retained 1/4 royalty interest in land he once owned. Now I found out there is a horizontal well that has been producing on this property the company had set money aside in a escrow account, I was wondering do you know if a producing royalty interest receiving money is considered real property or is it personal property in WV? My family member willed me all her real property and I am to divide any personal property with other heirs,
Very interesting situation. Oil and gas are considered real property when they are in the ground, and personal property when they have been produced. As the owner of the oil and gas (I’m assuming that when you say “royalty” you mean minerals) you should be entitled to sign a lease and receive royalty payments. I can’t say for sure whether you would have to split the royalty payments with the rest of the heirs, but any bonus money would be yours.
That is, of course, assuming that “royalty” means mineral rights. If it’s just royalty, you won’t be owned a bonus, and you won’t be signing a lease. A quick look at the document your great grandfather used to retain the 1/4 interest would clear that up.
I was recently contacted by an “independent contractor” for Appalachian Land Services, Inc. Told me she is researching descendants of my great grandfather who owned property in Wetzel Co. WV to pay out royalties..She is asking me to provide her with information regarding the other descendants. When he sold the property, he retained the mineral rights for his heirs and are included in his will..
I been in contact with this person several times, and she seems to be very reluctant to give me specifics regarding the property.
Any suggestions?
Do a little research to verify that Appalachian Land Services is a real company, and that the landman is working for them. It never hurts to be cautious.
It’s a little odd that she wouldn’t give you details about the property. I would think she’d let you know the location and size at least.
Hi Kyle,
My family and I have been contacted by CNX Gas Company about mineral rights on 54 acres in Monongalia County, WV that belonged to our aunt. It says 54 GROSS acres, being 0.1124982 NET acres. I have no idea what that means. They are offering $500.00 and 15% royalty. Does this sound fair?
Thank You
Cathy
The 54 acres gross is how many acres are contained in that tract of land. The 0.1124982 acres net is your interest in the 54 acres. You own a small fraction of every piece of sand, every rock, and every molecule of oil or gas that underlies that 54 acre tract. It’s calculated as an acreage amount, but there’s not a 1/10 acre area that you can point to and say, “I own that”.
The $500 and 15% is a decent offer, considering how small your interest is. If you calculate it out, that’s about $5,000 per acre, which is a good price in Wetzel and Tyler counties, where development is still hot.
That said, always ask for more. Try to get a better royalty if they make you choose between royalty and bonus.
I have read a lot about lease prices and royalty percentages, but nothing mentioned about actual royalty dollars. Are there any examples of acres related to royalty dollars. I was trying to get an idea of what to expect in terms of typical dollar payments.
You won’t find anyone who will give you an exact dollar amount, or even a general figure. That’s because the size of the royalty check is going to vary on a number of factors that are outside anyone’s control. Some of those factors are: 1) the amount of gas produced, 2) the composition of the gas (wet/dry percentage), 3) the price for gas on any given day, 4) the post-production costs that the company will charge your royalty (even though they shouldn’t), 5) the size of the production unit your tract is included in and your interest in that unit and tract. Rough rule of thumb is that you can expect to get, a couple times per year, the amount of the bonus you were paid, if everything goes in your favor.
Hello. I am glad I stumbled upon this page! My husband and I signed an oil and gas lease with Mason Resources, Inc. dated July 18, 2014. We had an order for payment for 100% bonus consideration on the approved net mineral acres @ $4000.00/ac. This was to be paid within 120 business days. We were unaware that we even owned the oil and gas rights, but according to Mason Resources, we own 1.69802 net acres. I asked for a copy of title work before we signed lease but was told that they only had preliminary information and would send a copy once the lease was signed and a complete title was done. We have not received anything from the company in regards to the title search. Also, as of today February 15, 2015 we have still not received payment. What happens now that they have defaulted on the contract? If by chance they found out that we do no own the oil and gas rights, do they still have to pay us the bonus amount since it has been over the allotted 120 business days? Thank you so much for any help you can provide!
Good question. This is something that the oil and gas companies don’t point out, but when you sign the lease and send it back to them, they reserve the right to accept it or not. There really isn’t much you can do about it at this point. If, in the future, you get another lease to sign, makes sure that the lease includes something that says they will pay the bonus in full even if they don’t end up accepting the lease. I’m sorry you had to learn about this too late to help you. Hopefully some other people will see this and learn from your experience.
Do you pay taxes on mineral rights?
In West Virginia, before this year, each county could decide whether it taxed mineral rights in place (in place as opposed to pulled out of the ground and royalties paid on them). Now they have to, so people who didn’t used to get tax tickets are. Does that answer your question?
My family owns 78 acres in Marion County, WV in the Mannington area. I know there is quite a bit of drilling in this area via news. Republic Energy out of Dallas TX has offered $1,000 an acre and 12.5% royalties. Is this seem fair? There is also a paragraph which states “It is agreed that this lease shall remain in force for a Primary Term, 5 yrs. from the date hereof and as long thereafter as the said land is operated by Lessee in the search for, or production of oil and gas. Lessee has the exclusive option to extend the Primary Term of this Lease for an additional 5 yrs. term.” Does this mean they can continue for 10 yrs. without reassigning with us? Can I get more info about “No Warranty of Title and Indemnification? Thank you, Donna Hennen
The bonus and royalty are their first offer. Always ask for more. Try to get them up around $2000/acre on the bonus and 18% gross proceeds on the royalty. That might be really pushing it in Marion County, though.
The No Warranty of Title just means you’re not promising that you own anything. This is important because you don’t know that you own anything, and there is most likely some kind of problem with the ownership of the minerals; there almost always is in West Virginia. Indemnification means if something goes wrong in relation to development of the oil and gas you won’t be held liable.
Hi Kyle, my wife was recently contacted by Haggerty about a lease amendment on 80 acres in Tyler County. It appears the original lease was in 1894. The paperwork states 1/8th as well as a $200 signing bonus. We are located in upstate NY and are out of our element here. She does have 2 sisters as well as an uncle that have received the same information. Obviously there are other relatives out there. Is this offer reasonable? I am inclined to have her sit tight on this and wait but again we honestly don’t know how to proceed.
She probably has a pretty small interest. You can probably negotiate for more than $200. The 1/8 will be hard, perhaps impossible, to negotiate up. Get a No Warranty of Title clause and an Indemnification clause, and ask for Gross Proceeds. Waiting can sometimes be an excellent strategy.
If the oil and gas royalties under a piece of land are owned by a husband AND wife and only one signs the lease is it valid?
If they both own the minerals, then the lease is only valid as to the one who signs. The other will need to sign. If the minerals were inherited by one spouse, then the other probably doesn’t have any ownership. That would depend on when the minerals were inherited.
Hello,
I have received contact from Anterio Resources asking for us to sign a lease. The first expired quite fast, the second came with another lease (2 total) one is for leasing the mineral rights (.085..) at 12.5% and 500$ signing bonus, and another is a Paid-Up Lease with an additional 500$ signing bonus. I am new to this and I know it says North and South in Dodridge County. I also ran across a forum where a lady recently visited Dodridge and posted all of the new, producing and non-producing tracts with heir names and ours in on their (the last name). My question is this: Are they already drilling and trying to have us sign this Paid-Up Lease with 10$ mumbo to cover their tracks? Are we owed? It’s not just me, but other family members as well. Thank you so much and I really hope you still respond!
It’s possible they are already drilling. It’s also possible that your family name is on a well site where you don’t actually own minerals. Your ancestor may have owned multiple tracts in different parts of the county. That was common back in the day. I’d ask them for a better bonus, better royalty, gross proceeds, indemnification, and no warranty of title. Good luck.
we own 3acers here in wv. the gas company has to travel thru our land to get to their land, what amount does the gas companys pay to travel thru our land? thanks
That depends on how much you agreed to. The company can’t just travel through your land. They have to get permission. There should be a Right of Way agreement in place. Ask them for a copy if you don’t have a copy, and follow that. If there’s not one in place, you can probably get a few thousand dollars out of them, depending on what your land is used for and how much of it they use. Nice cultivated property would have a different value from commercial real estate would have a different value from a steep hill with a road carved into it.
A distant cousin (93 yrs old) and I have been contacted by JRS Land, Washington, PA, regarding their desire to buy (not lease) our mineral rights on 105 acres (52.5 each) in Liberty District, Marshall County, WV. Your thoughts and what is acreage going for in Marshall County? Thank you
That’ a sizable chunk of property. I wouldn’t part for it for less than $8000/acre. Maybe more. I also don’t recommend selling. If you can hold on to the property it will be more valuable in the long run, assuming it gets developed at some point in the future.
Hi Kyle, Anything pertaining to or laws about stepchildren/blood children being mineral owners when a parent remarries or passes away? Does a will prevail over all other claims, if the will states the minerals were passed to second spouse and then to the stepchildren? Thanks
A will is usually going to prevail, although in West Virginia a surviving spouse can have a will set aside, in part, in some situations. It gets pretty complicated, actually. I’m going to refer you to my colleague across the street, Daya Masada Wright, for a better understanding of estate issues. She’s easy to find with a Google search.
Hi, I and other relatives have received a new modification of lease for already recently drilled and producing wells(That modification was signed back in 2012 by my mother and other relatives) for an older 50 year old lease that had barely producing vertical wells on it. The landman said that the company wants to drill on or into a different area of the lease, hence the reason for another modification. Not sure why we are getting a new modification The modification is pretty much the same except it now includes vertical oil wells will not be pooled into units greater than 80 acres. I find that odd, but it appears to be standard, but was wondering why it would be added and if I can get the non-contiguous tracts removed from the language. Thanks. D
You probably can get the non-contiguous tracts language removed from the Modification. It will depend on what the developer wants to do with the property, so no guarantees, but it’s worth trying for.
That does sound a little odd, but if you ask questions you should be able to get a satisfactory answer. If your landman can’t explain things, see if you can talk with their superior. Sometimes it’s just a matter of one person being able to relate better than another.
Thank you sir!
I did talk to him and he satisfactorily explained both. They are actually going to use the rest of the 213 acres that’s not part of this current well pad ito be a part of other units from separate well pads. One side that is unused will be part of a unit on a pad being drilled now and the other side that is currently unused will be a part of a different named unit on a future planned pad.The 80 acre for vertical wells was added due to a lack of large amounts of oil being found in the Marcellus in Doddridge county. It doesn’t’ appear that the ‘non-contiguous tract’ part of the lease will have any affect on us. Thank you again!
As a descendant of original OMG rights owner, I need some help with understanding the lease. Was offered $2500 an acre ( 2-3 net acres) and 12.5 % royalty. After much reseach, looks like the royalty is higher for property in Ritchie County’s Clay district , somewhere in relation to Gnats Run. Antero’s rep is willing to do more with the royalty. Need clarification on various things you suggested be in the lease. Thanks
I think you can do a bit better in Ritchie. The bonus may be about right, but you should definitely be able to bump the royalty up to between 15-18%. Ask for more. You may be pleasantly surprised. Ritchie County is heating up right now.
Kyle, How does a landowner know if a gas storage easement agreement is void or still active? 10 year lease expired in 2013, no activity on actual land (surface was reserved). Some neighbors signed, others didn’t.
Gas storage can be tricky, because your property may be used for protection of a gas storage field, in which case there won’t be any wells or surface use to indicate you’re part of the field. You’ll have to do some calling to find out if you’re part of the field or not. Ask neighbors if they’re included in a storage field. If they are, they should know the name of it. Look up the field name. Then find the company that operates it, and call them.
Recently, my family (more than 100 people) was notified we had mineral rights in Wetzel County. Amount is 45 acres belonging to our great, great grandfather. Land rights have been sold. Our “interest” in the mineral rights is .0347222%. Each sibling (8 in total) was offered $250 signing bonus and 15% royalties for 5 years. Renewal bonus amount for an additional 3 years was $500. We did not sign paperwork. Then Statoil came back with a new amount of $2000 signing bonus and 15% royalties for 5 years with renewal bonus for an additional 3 years at $2000. Now we think this is a much better deal. What do you think? What are other things to look for in lease agreement?
This is an excellent example of the way things work in the oil and gas industry. Developers will never bring their best offer to the table. They expect to haggle. Often times just saying “no”, or even just ignoring the first offer, will get you a better offer.
That said, if the market takes a dive, you can end up with a lower offer or no offer at all. Do some research and keep your ear to the ground.
All that said, the bonus is probably good, but the royalties could be better. If they offered 15%, they’ll probably go up to 18% without too much argument. Ask for 21% and see what they say.
Where you have a small interest, you are fine if you can get an Indemnification / Hold Harmless clause, a No Warranty of Title clause, and Gross Proceeds, along with increased bonus and royalties. There are loads of other things you can get in a lease, but when you have a small interest it’s much harder to convince the developer to include them.
I became co-owner of approx. 66 acres mineral rights in Doddridge county in Nov. 2002 because of the death of my spouse. Late in 2013 we signed a new lease for $5500 per owner. Recently the Lessee, Antero Resources sent us a Modification Of Oil and Gas Lease. The other owner who lives in WV signed and returned. I feel we are owed further money for the horizontal development clause. Re-reading both the leases I do not see a “Pugh Clause,” and I am concerned about the depth of drilling issue. Representative says we are not entitled to more compensation because the original lease was signed in 1979 and I signed the one in 2013. She states only the new lessors in the pool are entitled to pay. I cannot find where this is addressed in researching and I do not live in WV. I really cannot afford an attorney so what do you advise? Thank you in advance.
So you have about 33 net mineral acres, if I read your post correctly. That’s good. You have a large amount of acreage for a West Virginia mineral owner. It’s really too bad that the other owner already signed, as you could have probably gotten more if you’d negotiated together.
Antero’s attitude towards Modifications is that they’re going to benefit you, so you might just as well sign. They have a point; if you don’t sign the Mod, you won’t benefit from the horizontal fracking. On the other hand, Antero has some money to spend and they might as well give some of it to you. If you ask, you can usually get them to give up at least $500 to sign the Mod. I’ve gotten them up to $4,000 in one extreme situation. I know there is one guy here in West Virginia that has an agreement with Antero that they’ll pay him a few hundred dollars per acre. He owns extensive mineral rights, and has regular dealings with them, so it’s what you might call a sweetheart deal. If you were dealing with other companies, such as CNX, Consol, or Dominion, you would be able to negotiate several hundred dollars per acre. I think that since you signed the lease for a mere $5,500, you should be able to negotiate a higher “inconvenience fee” for the Mod.
A Pugh Clause may or may not be on the table with them. They will probably balk at changing much. But you can always ask. You should ask for an Indemnification / Hold Harmless clause, and a No Warranty of Title clause. They don’t have much trouble giving those up. Best of luck to you.
Hi Kyle, My siblings and I were contacted about amending a lease in grant district(Richwood Run) of Wetzel County by EQT. We did not know about the mineral rights, until Larry called us. We are being pressured to sign by Sept. 15th. I have been trying to research as much as I can. They said they own the lease and all they will give us is 100.00 for signing and the by law amount of 12.5% royalty, it does not state 12.5% in contract. There is a Indemnity clause. Shut In is 25.00. Larry is now telling the people who want a better deal, that EQT doesn’t need to deal with us and that they will apply to the courts to drill and those that do not sign will lose our rights to anything. Is this true and should we hire an attorney? It is 300 acres. Our part is 89.75 acres and a lot of relatives (they tell us) to share with. He said our net is .047567. I am getting really confused as to what to do. It has a Ratification of Remaining Lease Provisions. that says Lessor and Lessee hereby ratify and agree that the Lease is valid and in effect. Are they talking about the old lease if so I have the original 1912 lease but no amended leases. So I do not know if they are in violation of any terms or provision of the lease, including royalty or rental payments. Larry said the well that is producing is not on our part of the 300 acres so we are not entitled to anything from that well. True or Not? Is this an okay deal for Ratifying a lease, it doesn’t sound very good to me, but we don’t want it taken away from us either. Please respond as we are running out of time. Thanks, Sharon
I’m a full eight days after the September 15th deadline here, but may as well respond as the oil and gas producers don’t always act on their deadlines. Their deadlines are more to try to get people to do something than they are actual drop dead dates.
Negotiating an Amendment/Modification/Ratification of an existing lease is usually quite a bit different from negotiating a new lease. There are already terms in place, and the developer usually doesn’t want to change those. One of those terms is the 12.5% royalty. They’ll change it, but only if you’re the negotiating equivalent of a hungry bulldog.
It sounds like you don’t have a large interest in the minerals. That means you have less negotiating leverage. They have to sign you up, by law, so you do have leverage. But if you want to play hardball, and the developer wants to play hardball, they’re going to win because they have more money to throw at the situation in the guise of lawyers and court time. It won’t be worth it to you to fight over 0.047567 net mineral acres, because you’ll never get your money back. They will.
I don’t know how you can prove the old lease hasn’t been violated, or has been violated. You are probably not in a situation where you can get all the facts. I’d try to get that clause removed from the Amendment, but if they refuse, there’s not going to be a whole lot you can do about it.
Apportionment is what’s keeping you from getting royalties from the existing well. At least, that’s most likely the case. Where a lease is taken, a well is put on the property, and the property is subdivided, the tract that contains the well will be due all the royalties. I don’t think it’s fair, but that’s the law in West Virginia.
I have mineral rights in Gilmer county WV, what is the per acre going rate at the moment? Any info would be greatly appreciated as I have been contacted with an extremely low offer to ratify the existing lease signed back in 1974. They would like to pool acreage for a horizontal well, offered 5.00 per acre and 12% royalty.
Can they hold a lease in WV if there is no production for a well?
I, like a lot of other folks, have been contacted by Antero about the mineral rights to 12 acres in the Cove Tax District in Doddridge County. They’re offering $1,500/acre with 14% royalty. I haven’t read the entire contract yet. It sounds like there’s much to learn about (what you don’t know can cost you). I just want to make sure everyone gets what reasonably should be there’s including the oil and gas companies. I have two questions:
1. Do the above amounts seem “fair”?
2. Should I contact you for help?
“Wondering in Ohio”
You can do better in Doddridge. Most negotiated leases get over $2,000/acre and around 18% on the royalties. You can often get gross proceeds as well. Is it 12 acres net, or gross? The Order of Payment or the Offer Letter will usually tell you.
Well, I think you should contact me for help. But then, negotiating leases is what I do, so I think everybody should contact me for help. I’m a bit biased. Call me at 304-473-1403. We can discuss whether hiring an attorney makes sense for you. If your net mineral interest is below about an acre, I’m usually not going to be worth hiring, but I’ll give you a bit of free advice that will just keep you out of trouble and make the lease a tiny bit better for you. Have a pencil and paper handy when you call.
Hey! My brother. sister and I have been approached by Noble Energy for a lease on 60 acres in Pleasants County near Hebron. They are offering $1000 an acre and 12.5%. We are babes in the woods regarding mineral rights and wonder if this is a fair offer, in your opinion. A complication is that my sister is in CA and I am in MS — only my brother still resides in WV. Thanks for any advice you can offer.
Congratulations! Pleasants County property is quite valuable, thought the prices haven’t been driven up as high as they have been in Tyler County yet. If they’re not willing to hit $3,000/acre and 18%, I’d sit and wait a bit. Waiting has some risk, as the oil and gas industry could bust, or the companies that are interested in Pleasants County could find another area they’re more interested in. But looking at things today, I think I’d still wait, if your financial situation allows it.
I work with people who are out of state all the time. The huge majority of my work is done over the phone and by email.
I have 228 acres in Wayne WV and I have been offered $250/acre with 1/8 can I get more? 2 landowners close as sighned at that. Would $500/acre and 3/16 or 1/4 be to much to ask?
Wayne County is an up and coming area. Last week I communicated with two mineral owners and a landman who all had action in that part of the state. I think I might wait a while to lease my minerals. Waiting entails risk, of course, as the industry could bust, or the companies could decide they’re more interested in another part of the play. One option is to sign a short lease (1-2 years) if the company is willing.
Your offer has the highest numbers I have heard for Wayne County so far, by quite a lot. The others were in the $25-$50 range.
I was offered $50/acre for another landman and I told him I was offered $250 and he said he would match it so I think they are lowballing us.
Could I contact you?
Of course. Negotiating oil and gas leases is the majority of what I do right now. Call my office at 304-473-1403.
We have 12 acres in Wetzel co. Offered us 2,000 with 14% with 5 yr lease no detention. We asked for 20% with maybe 3500 or 4000 is this reasonable or not. Thanks.
Is that 12 acres net or gross? I think $4,000 is more reasonable in Wetzel right now. In fact, you should probably hold out for a little more than that. 20% would be the highest royalty that I’d heard of in WV so far. But I have heard rumors that some leases are being signed for 20% in Tyler County. You’ll have to get a feel for what’s going on in your area. Talk to the landman, ask lots of questions. Play dumb if you have to. The more you know, and the better you get to know your landman, the more likely you are to be able to “feel” when they’ve hit their best offer.
What is a reasonable amount $$$ for negotiating surface acreage for a Marcellus well site? Console is interested in 8.4 acres of my land in Doddridge County. What should I be aware of when negotiating?
Right now, somewhere between $2,000 and $2,500 is reasonable in Doddridge County. It’ll vary from project to project, and most of the leases that I’ve seen in Doddridge have hit $2,500, but there are some outliers. You may be able to negotiate for more, or the company may simply refuse based off their experience with production from the area or the other leases they’ve signed in the area.
Kyle, I and two other family members have been contacted by antero about leasing rights in the Salem area (Harrison County.) They have offered a signing bonus of 350 each plus 12.5%. My question then, is this a reasonable offer or should we be asking for more than what is being offered?
You probably have tiny net mineral interests. The going rate in Harrison is about $2,500/acre. You can probably negotiate the royalty up a bit. Also get Gross Proceeds, No Warranty of Title, and Indemnification. Those last two should keep you out of any legal trouble.
Myself and heirs plus my son and those heirs own roughly 4000 acres in wetzel county with several active wells going back several years with Chesapeake and statoil. We now have been dealing with the new accounting practices that allow them to deduct production costs which have been exhorbanent. I have educated myself with the dealings of Chesapeake and access midstream and wanted to know what you think of the Rico suit filing in Pennsylvania.
I actually only heard about that lawsuit about a month ago. To be honest, I was surprised that nobody in WV has done the same. All the same circumstances are in place here. Call me and we can discuss whether this is something you would want to do.
304-473-1403
I have received 4 postcarts (generic) asking about selling my mineral rights in Grant district Ritchie County WV. Should I consider these pre offers or wait for a lease? I have OMG & surface on 35 acres.
I’d keep those mineral rights. You can probably lease them for at least $2,000 acre without even negotiating. You can probably drive the price up to $3,000/acre. Royalty could be as much as 20%, though 18% is much more common right now. Hold off if you can.
My acreage (after relatives) is 2.67 in Doddridge County. Would $2,000 bonus and 18% net royalties be reasonable for that area? I wasn’t offered this, but I am negotiating for it.
That is pretty reasonable. I’d probably try for a little more on the bonus, and get gross proceeds. I hope your relatives are still negotiating too. That would put you all in a better position.
Have old lease of 75 acres in Harrison county. Only receiving storage royalty of 300 per year. Can I get new lease for marcellus and lease bonus? What per acre on lease bonus and what royalty?
That old lease will remain alive for as long as they’re paying the storage royalty. In some rare cases, that old lease will not be for all formations. But that is extremely rare. Grab a copy of that old lease and read through it to see if it mentions anything about reservations or exceptions, or if the granting clause (usually first paragraph) only gives certain formations. Most likely you’re out of luck for a new lease.
However, when they get around to developing your property for the Marcellus, the Utica, or some other formations, they will need to approach you with a modification or amendment of that old lease. They will need the right to pool. They will pay (not as well as for a new lease) a bonus amount, and you can negotiate some better terms at the same time.
I have a similar situation with an old lease via Columbia Gas but when they assigned the old lease to Noble and CNX who developed a well and have started production from Marcellus, I was not offered opportunity for lease modification or amendment. I was given no up front $ and only 12.5% royalty. Should I have been given opportunity for lease modification??
I think I would have to take a look at the lease in order to determine whether there is something that could be done for you. Can you scan and email a copy of it to me?
My family owns OGM rights to a 110 acre tract and a 40 acre tract in Wirt County. Are there any companies actively leasing in that area anymore that you know of and under what terms?
Wirt is starting to pick up right now. There’s a landowners group just starting up. I don’t have contact information for them yet, I’ve only just heard about it. I think Antero is leasing just a little bit there, along with some other smaller companies. I’ll bet there are some landmen picking up leases to flip down the road. I’d be patient for a bit and see what happens. If someone approaches you with a lease, get back in touch.
Wirt Co Oil and Gas association info. Chairman is Jim Lydon. JR Ruble is assisting mr lydon. U can also contact Thorn Roberts. Im a member of association and have recently been contacted seperately from a comapny. Tom Whitaker is also a lawyer representing the association. The offer I received was the price 100 yrs ago.
Thanks for the info, Melissa. Is it OK to post this online?
Absolutely. Id really like to speak with you. Had a company come to me last night and would like a lil info. I sent you an email yesterday regarding it.
My sister and I own 14 acres in Wetzel County that was left to us by our mother. We were offered $2800/acre + 15% no cost royalties for a 5 year lease. Is this a decent price? I know that activity is high right now, as we were just called about property we have in Tyler county. Are the offers similar in both counties? Thanks for any information you can give me.
You can get more than that for the bonus. I wouldn’t sign for anything less than $4,000/acre. That’s a bottom dollar amount, too. They’ll probably go above $4,000. Tyler County commands similar dollar amounts, if not more. Don’t forget about the royalty amount (20%) and getting gross proceeds. And always ask for Indemnification/Hold Harmless and No Warranty of Title. Also, ask other family members besides your sister if they’ve received offers. Team up for more negotiating power and to make it more affordable to hire an attorney. I’m always willing to split my fee between family members.
Ken; I received a phone call last night telling me that I own mineral rights on .19 acres on land in Marshall County, West Virginia. The caller told me he was representing an oil company and that they would offer me over $500 to lease the .19 acres of mineral rights. Apparently, the mineral rights belong to my great, great grandparents. How can I determine if I should agree to this offer?
You can get a little more than that for the bonus. They’ve offered you $2,500/acre. I wouldn’t sign for anything less than $4,000/acre, or about $800 for you interest. Don’t forget about the royalty amount (20%) and getting gross proceeds. And always ask for Indemnification/Hold Harmless and No Warranty of Title. Also, ask family members if they’ve received offers. Team up for more negotiating power and to make it more affordable to hire an attorney. I’m always willing to split my fee between family members.
i live in preston county wv and my 5 year lease ran out in may with tenaska and im being told that nobody is getting leases signed anymore in this area….what has me puzzled is back in 2008 the landmen talked like this was one of the best areas in wv….we are wanting to lease again but dont know where to even begin thanks
I remember when Preston County was hot. I was working as a landman for CHK at the time, doing abstracting in Monongalia County and Tyler County. Eventually, the test wells in Mon didn’t produce like they expected, and I think the same thing happened in Preston. Both counties are in the dry gas area. Dry gas is coming back, but it’s not as hot as it was back in 2008. My advice is to wait for a landman to approach you. You’ll know that you can get a better price and better terms at that point. If you really want to lease, go down to the courthouse and peek at the recent filings. Any company that’s filing leases in Preston County will probably be interested in your property.
My Parents as a farm of 101 acres,but lost dad in 09 my sister and I were added to the will in 2005. In 2010 cheasapeake give $5,000 to me and $5,000 to my sister one year later gave my our mother 92,600.00 but now lease has expired another company is now after it what would be a honest and good price to ask them to pay.
Hi Kevin, like Kyle’s situation, it’s going to depend on which county you have property in. Tyler and the northern panhandle are the most expensive places right now, at $4,000/acre and above.
We have an older gas well on our property that we get free gas from. The lessers of the well are telling us they may shut it down as it no longer is making them money. They are telling us they will be capping it and that leaves us with no gas at all. They tell us it is state law that if they service no customers that they are required to cap the well. Is this true and are we just out of luck even though we are getting and using gas from the well?
I’ve heard of companies just leaving those wells to provide free gas to people. Sometimes they’ll sell them to the people getting free gas. If you do buy it, you’ll also have to post a $10,000 bond with the state for the plugging of the well whenever it does go completely dry.
State law does require them to do something with the well. They can’t just let it sit without production. After one year of no production numbers reported, the State is supposed to (resources allowing) send them a letter requiring that they establish production, sell the well to another company, or provide a plan for the well that will bring it back online within a certain period of time.
My father passed away 15 months ago and left everything to my mother.My Mother has been approached by STATOIL about a 15 acre tract that my father owns 1/2 percent mineral rights on. They have offered a one time $500.00 signing bonus and 15% royalties. Is this a fair offer.
If he has 1/2 a percent of the minerals under 15 acres, then yes, that’s a pretty fair offer. If he has 1/2 of the mineral rights under 15 acres, then that’s a serious low ball offer. The signing bonus is very dependent on which county the minerals are located in, but Statoil is mostly working in the Marcellus/Utica shale areas in the northern part of the state, and nothing is going that low there.
He has 1/2 percent interest of 15 acres. I know the royalties don’t amount to much, I just want to know what is a fair amount for signing bonus. It seemed to me that 500.00 wasn’t very fair. Thank you for any help you could give me.
Also, the acreage is located in Wetzel County. We are to meet with them tomorrow to sign lease,I just wanted to know whether to accept or decline offer.
I hope this isn’t too late, but $500/acre to sign a lease in Wetzel County is ridiculously low. Ridiculously, ridiculously low. If it’s a Modification, that’s a different story. You should really get in touch with me to discuss this.
We have acreage under lease and want Antero to put a well or two on our property. We are trying to undo the original lease because of it was not done correctly. I don’t want to have Antero upset and not drill. Could that happen?
Getting a lease undone is very fact dependent. We should talk on the phone and see what, if anything, can be done to break the lease.
I recently learned of the oil and gas in Richie County. I have several acres of land in Richie County, but live out of the area. Who is handling land acquisitions? I am planning a trip in to see that the property s protected and would like to meet with someone to see if there is any interest in the property. Thanks for your help.
I know that Antero and EQT are both actively leasing in that area. There are probably some other companies working there as well.
A lot of interesting information. I too recently received a letter from Antero referring to a lease agreement signed by my ancestors in 1904, for 307 acres of land in Doddridge County, West Virginia. What do I do? Just sign and send the contract back to them and hope for the best? Is there anything I or a lawyer can negotiate with them?
How much you can negotiate really depends on a number of factors. The most important is how badly you want to negotiate. Close behind that is how many net mineral acres you own. If you have a small number, your leverage is small. Large number, large leverage. Just the way it works. You mentioned 307 acres, but you’ll have less than that, of course, as the interest has passed down through generations.
That said, you should negotiate some, even if it’s just to get a No Warranty of Title clause and an Indemnification clause, and a higher royalty and bonus. If you have a few acres or more, you can contact me and we’ll discuss your situation.
I am one of several royalty/surface owners. We have an owner that has been deceased for over 60 yrs and no known heirs. The royalties has been sent to a trust. How do we have the shares split among the current holders? Due to a change in owners how long should I wait to receive a royalty check based on the new split? Is a year too long? How can we verify our royalty interests are correct? Any information you can provide would be appreciated.
Those are a lot of big questions. First though, congratulations on inheriting a valuable mineral interest. WV intestate law from 60 years ago would have passed the deceased owner’s interest to that owner’s siblings. If there were no siblings, then we should get on the phone and figure it out, because you’re looking at a more complex heirship question than usual. You won’t be able to receive royalty payments until the owners of the interest have been identified. The only way to know that your royalty interests are correct is to figure out who owns those interests.
There is a small group of neighbors in Brooke County who did not respond to Chesapeake’s first and only letter offer. We set up two group meetings with them over a year ago and the first time the representative said he had a family emergency and the second meeting he called an hour before saying they weren’t buying at that time. My neighbors and I have talked about again recently and are wanting to look into leasing our land. We can see the well site on St. Johns Road (Balato’s Salvage Yard) from our house and the one on Northview Road we saw when they were burning the gas off. If that’s the right term. Can you let us know if there is anything available for our group. I saw an earlier email from September of this year regarding Hancock County. Thank you Kathy Wetzel
I haven’t heard of much development going on up in Brooke County right now (October 2013). That puzzles me, because it seems to be a great area for development based on the maps that I’ve seen. Give me a call and we can discuss the situation. 304-473-1403.
Antero Resources say they will be coming back to drill on units they skipped the first time through in Harrison County, WV. I was also told they were able to drain the gas from my little unit by drilling close to the lease line on the unit beside it (which is also part of the same lease). Do you know if Antero will be coming back through in 2015?
I have no idea what Antero’s plans are. Frankly, they probably don’t know what they’ll be doing in 2015. I’m sure they have a plan, but oil and gas companies are notorious for changing their plan from week to week, and day to day. The only constant in the oil patch is change.
They could be draining your property. From what I’ve read and heard so far, the fractures only extend out about 200-300 feet. (My information on that could be faulty, so if you come up with a reliable source that says otherwise, please let me know.) So the leg will have to pass within 200-300 feet of your property line to drain gas from you.
We received a Modification of Oil and Gas Lease to include horizontal drilling and pooling. How do I know if I should sign this or not? It is from Antero Resources. They are purchasing the lease from Carter from 1898.
The Modification is necessary. It’s what allows them to do horizontal drilling. The horizontal legs are 2000 to 7000 feet long (as of October 2013) and there isn’t a tract of land in West Virginia that can encompass a horizontal leg all by itself. So if you want the royalties that come along with a horizontal well, you’ll have to sign the Modification.
However, you don’t have to sign it as-is. You can ask for limits to their ability to pool, you should remove any clause that states that you need to notify them about their failure to stick to the agreement, and you should negotiate for a better bonus, a better royalty, and gross proceeds. Of course, you’ll need to read the agreement closely and make sure there’s nothing else in there, because what they include in their Modification could change between when I’m writing this and when you’re reading it. Also, your life situation is going to be different from everybody else’s.
Hello,
I have mineral rights in Letcher County Kentucky. I am in the process of negotiating a lease. Wondering what the standard per acre bonus is in this area. Do you represent this area?
Thanks.
I’m not licensed to practice in Kentucky. Sorry. I don’t know anyone in Kentucky that I can recommend, either. The best way to find out is to ask around, if you live in the neighborhood. If not, get on http://www.MineralRightsForum.com or http://www.GoMarcellusShale.com or http://www.shaleforum.com. You can find quite a bit of information at those sites. Additionally, you can Google your county name and “oil and gas” and see what comes up.
My family is both the surface and mineral rights owner under a track of land in Doddridge County, WV. Antero has been aggressive about wanting us to sign a lease. If we do not sign, can they suck the gas out from underneath our land without paying us for it?
Also, I have mineral rights on a couple of tracks in Greenbrier county and other heirs have sold out. Antero has indicated they do not need my signature to drill.
Also, I am helping my relatives and have inquired with
antero about modifying ther terms and conditions of the lease for 3 relatives, they don’t want to do this either. Any advice would be great — I don’t feel I can trust the company at all.
Sorry I’m so late getting to you. If you don’t sign, the company will do what’s called a partition suit. They can petition the court to allow them to develop the property and sell your portion of the minerals. I haven’t been through one of these suits yet, but what I understand from reading is that the company has to either show that they can’t find the mineral owner, or that the mineral owner is not willing to negotiate reasonably.
They shouldn’t be able to suck the gas out from under you. Without a lease, they are trespassing, and can be taken to court for that.
Modifying the terms of an existing lease is going to be nearly impossible. If Antero decides they want a Modification, it will be so that the Marcellus Shale can be developed through use of horizontal drilling, and they’ll approach you. At that point you will have some negotiating leverage, but not much. You can contact me at 304-473-1403 to discuss if they approach you about Modifying.
I too , have just found out that I own mineral interest in Doddridge, New Milton district. I have a lot to learn. Antero has sent us papers for lease at $100.00 signing bonus with 12.5% interest. They said our interest was in the 77.6 acres but wanted only .00157 acres…. is this a good amount. there are 10 of us heirs that this goes to from our great grandfather. We still don’t know where the property is or how big the full property is or even if we own any surface or not. tried to contact the assessors office but they didn’t find anything either except for a civil suit from antero…. I don’t think I understand most of these papers. All I know is that the gentleman from antero said only one person has to sign the lease and we would all get 12.5 % (1/8), and 100 dollar bonus upon leasing… any advice anyone could give me would be greatly appreciated… He also stated that he didn’t need to have us sign anything , that he could go ahead and drill without our signatures, but he doesn’t want to see anyone lose any mineral interests that are our inheritance…
thanks for any imput you can give me on this …..
Lisa…
Hello……my aunt owns 5+ net acres in Mannington District, Marion County. She was offered a lease by American Shale/Republic Energy with a $700/acre bonus and 15% royalty. Is there a lot of activity in that area? Should we ask for more? Would it be to our benefit to contact other companies for competing offers? Thank you in advance for your time.
There is activity in Mannington District of Marion County. If her 5+ acres is part of a larger tract of mineral acreage, then she has some negotiating leverage, but not a lot. If it’s a 100% interest in a 5+ acre tract, she has a little more. You should be able to do better than $700/acre. Try to get it up to $1,200/acre by asking for a larger amount, or just saying no. You can probably work the royalty up too. If I recall correctly, EQT is working up there, and it’s always a good idea to get competition going. There may be some other companies working in the area, too. Pay attention to what trucks you see going by on the road, and ask the neighbors in the next hollow. If you want to get really sophisticated, you could go to the courthouse and look at all the leases that have been filed recently. You could also go to the DEP’s Office of Oil and Gas website and play around there for a while. You can find all kinds of useful information there.
I have 1. 5 mineral acre in Marion County wv mm- appalachia-Iv lp, wants to buy my mineral acres for 3200.00 an acre is this a good deal
It’s an OK deal. I’ve been able to lease for $1900/acre in Marion county. But times they are a changing, and gas prices are down this year. It might not be possible to lease for that much now. Hold out for another year or two, and prices might go up again, but that’s speculation. Nobody knows for sure where gas prices will be tomorrow, let alone two years from now. If you need cash now, then you should sell. If you can wait, your minerals will most likely be more valuable in the long run. Mineral ownership is a long-term speculative investment, and should always be looked at that way.
Hi Kyle I stumbled upon your site. I own 50 acres in Preston County with minerals, do you know of any active leasing in Preston County? I personally have not heard of anything in a while. Our neighbor that owns about 100 acres claims she was approached by a company from Denver offering $1100 per acre but she could not recall the name. Just curious. Thanks!
I haven’t heard of a lot going on in Preston County recently. The WVDEP web site will allow you to look up recent Well Work Permits by county. There are five wells that have been issued permits this year. That’s not a lot.
Here’s the link to the DEP web site:
https://apps.dep.wv.gov/oog/permitsearch_new.cfm
You can play around with that a bit yourself and figure out what’s going on.
I have 222 ares in hancock county we was offered 3,000 an acre and 15.5 % that was around oct 2011 from chesapeak. the people in our area turned it down so we followed suit. since then we havent heard anything. do you know if they are still leaseing in hanock county Thank You
I haven’t heard of anything going on in Hancock County recently. If you go to the West Virgina DEP’s website you can find out if there are any oil and gas wells being permitted in Hancock County. But it would probably just be easier to call them and ask. 304-926-0499.
The northern panhandle was really hot there for a while, and then it just died off. That’s about the time they got interested in the Utica over in Ohio. I think it’ll be coming back your direction eventually. Be patient.
HELLO, MY GRANDPA RECENTLY WAS CONTACTED BY ANTERO RESOURCES AND ASKED TO ALLOW POOLING IN THE LEASE. WHAT SHOULD I DO FROM THIS POINT AND THEY ARE OFFERING 12.5 WITH NO ACREAGE BONUS. CAN I OBTAIN AN ACREAGE BONUS EVEN IF IT ISNT A NEW LEASE. I HAVE ALL THE PAPERWORK THEY HAVE SENT HIM.
Robert Smith,
Usually they will not allow an increase in royalty, but the should offer something in the way of a signing bonus. It’s usually not based on the number of acres, but will be a one-time payment of $500-$2000. You may also be able to negotiate a gross proceeds clause.
Kyle,
My family owns 165 acres in Upshur County (Banks District) . We have
been offered a bonus of $500 per acre and 13.5%, (5 year lease). Do you think this is a resonable offer? We also have a water source.
Thank you
Barbara Adams,
You should ask for more on both the bonus and the royalty. Also, the terms of the lease are important. Please contact me about the lease. My apologies for taking so long to reply.
dear sir your last response is right on the same line as I am involved in with property I own interest in tyler and Ritchie co wv I would like to talk to you about this matter . where is your office at and your phone number .hope to hear from you as I need some answers on this matter. ROY A. MEREDITH thanks
We were notified yesterday by a company wanting us to lease them our Oil.& gas intrest for 118 acres in Harrison County. We were never notified that we owned this…or what it is.we.own? Says it was entered in record.of.deeds.1/1/13. This is the first weve heard. We live in Ky-
Most likely it was an oil and gas producer named Antero Resources, based out of Colorado, with offices in West Virginia. They are very busy up in Harrison and Doddridge Counties right now. They have about 15 rigs working in five West Virginia Counties.
You are probably the heir to someone who owned the oil and gas rights back around the early 1900s. That person died without selling the minerals, and without including them in a will. This happened a lot here in West Virginia. Minerals were valuable up until about the 1920s. That’s when the oil ran out, and they only had natural gas left to produce. Natural gas was not valuable, so people forgot about the mineral interests they owned. When they died the interests passed to their heirs through West Virginia intestate law. Those people often didn’t even know about the mineral interest, so it passed through intestacy to their heirs, and so on down to you.
I read the comments.I sent an email to Kyle
Thank you John. It is always good to meet another Nuttall!
Our family has 180 acres in Brooke County. Chesapeake is presently constructing a compressor station on our land. I would have thought that having that and a large transmission pipeline owned by Columbia that our property would be a good get for some gas company. Are there any active landmen working near Bethany in Brooke County? What might be the going sigh-up bonus and royalty (excluding any and all post production costs)?
I know that at one point Chesapeake was very interested in acquiring minerals up in Brooke County, and I thought that was a very active area. But it doesn’t seem to be anymore. That said, we could try to shop your minerals around, too.
I own part of a company that has 450 acers leased. within 10 miles of the wells being drilled on White Oak, near Pullman, Ritchie County, West Virginia. This is one continuous piece of land, near a very active, but old oil and gas well area. This lease started in early 1900s and had 4-5 old well producing, but not much. We are interested in letting someone drill, but have never been contacted. What should we do?
If the lease is still active, then you probably aren’t going to be able to do much. If the old lease has expired, then we could shop your property to a couple of companies that are interested in that area.
We own the lease so can grant permit to drill upon an acceptable arrangement. We have no interest in drilling ourself. Just want to arrange for someone else to do this.
This type of arrangement has be developed with other companies that have drilled the older type of shallower wells.
Finally some very good information to have. Thanks for the advice!
For anyone needing information Mr. Nutall has it.
Thank you, Monna!
Own 190 acres (mineral rights and surface rights) in Mason county district of Cologne WV. Presently leased with Penn Virginia Oil & Gas for $100/acre. Lease will be complete July 2013 with no extension agreement. Is this area producing any gas or oil and if so would you be able to direct me the best Lessee groups and assist in lease paper work.
Patricia Durst
I can assist with the lease paperwork. That’s the bulk of my oil and gas business at this time.
Mason County is not a very active area right now. Most of the oil and gas action is in the northern panhandle and the area between Clarksburg and the Ohio river. It could work it’s way over your direction in the next few years, though.
Just as an update to this, oil and gas development is definitely starting to pick up in Mason, Jackson, and Ritchie Counties.
Does WV law require a minimum royalty of 12.5% at the wellhead even if EQT puts a deductions clause in their contract (12.5% minus deductions to transport and make oil and gas marketable)?
Since 1982, if a producer wants to get a well work permit from the DEP, it must first show that it is paying at least a 1/8 (12.5%) royalty. If the lease allows for post-production costs, however, they can be taken out of the royalty.
Kyle , we spoke the other day , my fax is on the blink , please send me your e-mail address , we may have to communicate that way……………
Jim