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Oil/Gas/O&G lease in North Texas.

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Question
Dear Mr. Bonner,

My wife inherited 1/7th of 1/10th mineral interest on 241 acres in north Texas. We were contacted by another remote family member who said he knew a lot about the industry, represented a number of other family members, and would keep us advised of lease interests.
The result was that nothing was ever good enough. This started in 2009 at the peak of the Barnett play. Last year we contacted him and he revealed a little too much in that he said he was going to build his own house in the middle of this virgin tract and that he didn't want a rig in his backyard (his words).
We took it upon ourselves to learn a little and reached out to a major player who had made numerous offers before and suddenly we get a call. They are sending us an offer tomorrow and this is when the heavy lifting starts.
The offer is for 80 acs. of the 241acs., $500 an acre bonus, and a 20% royalty, 3 years w/ 2 yr. option.
We're smart enough to know that we don't know enough, but we do have a couple of basic questions:
1. If we negotiate a lease (with some representation), will all 130 mineral holders of record get their share of royalties and bonus?
2. Do all of the mineral holders have to be contacted and sign off on a lease to proceed?
3. If we are the original signers on the lease, are we sticking our heads in a noose for costs or liabilities that we aren't aware of?
It's a very confusing place for novices to be in but it's up to us to make something happen.
Thanks for your help,
Robert

Answer
There are too many variables and not enough information provided to really answer your question, but the general idea is that all of the owners of a parcel should agree to the lease and then the driller could drill.  There is a procedure called force pooling under which owners are forced to allow drilling by the Railroad Commission.  I don't know what other agreements or title problems which might be in place that would create liability for you if you signed a lease.

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Mark Bonner

Expertise

Interests include oil and gas leases, mineral deeds, royalty payments, interest on late royalty payments, post-production costs.

Experience

I have been an attorney for over 20 years.

Organizations
Norman & Edem, PLLC 127 N.W. 10th St. Oklahoma City, OK 73103 405-272-0200 (Tel.)

Publications
Oklahoma Bar Journal; Oklahoma Association for Justice Advocate

Education/Credentials
Highest Honors, OU College of Law, 1992 Earl Sneed Award for Oil & Gas

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