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Oil/Gas/Small Mineral Interest Worth Lease?


Through inheritance I own undivided fractional (1/2560) mineral rights on a quarter section (160 acres) of land in Graham Co., Kansas. A lease broker has offered me $20 per mineral acre for a paid-up 3-year lease or $1.25 total for
the bonus for the lease for oil and gas exploration. No royality amount was mentioned.

  Is it worth doing anything at all for so little? It hardly seems worth the trouble and paper work since my fractional interest is so small (.0625 net mineral acres).

  Thanks in advance for your help.

I agree, the bonus is not really worth messing with. Instead, I would ask them for a 1/4 royalty and no bonus. You will likely get more money in the long run with a 1/4 royalty than you will with the "normal" 1/8 or 3/16 commonly offered for a lease, assuming of course a producing well is drilled as a result. Not sure why no royalty was mentioned in your offer. Perhaps an oversight of some kind. Obviously you don't want to sign a lease that has no mention of royalty.

Hope this helps you out.
Frederick M. "Mick" Scott CMM RPL
The Mineral Hub  


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Frederick M. Scott


Oil and gas leasing, lease negotiations, how to best deal with the oil and gas companies or their representatives, buying/selling mineral rights, forced-pooling, correlative rights, deeds and conveyances, and "post-production" costs. I am most experienced with Oklahoma properties and laws, but am able to answer questions concerning other oil and gas producing states in many cases.


I am a Certified Professional Mineral Manager (CMM) certified by the National Association of Royalty Owners (NARO) in Tulsa, OK. I am also a Registered Professional Landman (RPL) with the American Association of Professional Landmen (AAPL). I have managed my family's oil and gas properties in Oklahoma for over 10 years and have dealt with many landmen, title analysts, attorneys and other oil and gas professionals in the process. I have written several articles which have appeared in various oil and gas industry magazines and newsletters. I have negotiated and drafted leases, prepared deeds, affidavits, and other legal instruments relating to my own minerals, as well as performed title, legal research, and curative work for same. I have acquired a good deal of knowledge on the subjects of oil and gas law, mineral appraisal, and landwork over the past ten years, and also worked as a professional landman and lease buyer for a time. I've seen the business from "both sides" and therefore feel confident I can help out most of the folks who ask questions in this forum.

National Association of Royalty Owners (NARO); American Association of Professional Landmen (AAPL)

National Association of Royalty Owners "Action Report" (ROAR); NADOA Magazine, The Mineral Hub, Landman Magazine, and several royalty owner association group's newsletters.

Certified Mineral Manager (CMM), Registered Professional Landman (RPL)

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