what type of lawyer do i need for land mineral lease non payments

Do I need a lawyer to own mineral rights?

 · Talk to a real estate attorney in your area. This should be a relatively simple document to draft. But you need to consult with an attorney experienced in creating custom-tailored leases to accomplish what you want. Do not use a "form" document for this that you might be able to find on the internet.

Who is involved in a mineral lease?

Regardless of the motive, consumers have a right to seek redress for their damages. If you feel you’ve been cheated out of royalties for your property’s minerals, contact the energy lawyers at The Potts Law Firm for your free consultation. frequently asked questions common types of damages our results Common Recoverable Damages

Can you buy land without mineral rights?

 · Absolutely you should retain an oil and gas lawyer to make sure you get the best deal, but also the best terms for your own protection. 99% of the time, the initial offer to you …

Do you need a mineral rights agreement to mine?

 · Attorney James Decker’s advice to ranchers entering lease agreements for oil and gas exploration on their land is to have a lawyer with expertise in the subject and mineral rights on your team. Read a producer's perspective on negotiating oil leases here. When the land man comes to call offering a oil lease for mineral exploration, James Decker’s advice is to make …

How long can you keep mineral rights in Louisiana?

10 years and one dayIn Louisiana for example, if you sell land, you may retain ownership of the minerals beneath it for a period of 10 years and one day at which time you must transfer such mineral rights to the current owner of that tract of land, but only if that owner has retained the land for the same period of time.

How much are mineral rights worth in Louisiana?

Unleased acreage can be below $500 an acre to $3,000 an acre depending on location. Acreage leased but not in production can be anywhere from $500 to $5,000 an acre based on activity in your area and production nearby. In the end your minerals are only worth what someone is willing to pay for them.

Do mineral rights expire in Texas?

In Texas, Oklahoma, Colorado and Montana, mineral owners can own the mineral rights indefinitely and there is no way for them to passively revert to the surface owner. If a surface owner wants to own the mineral rights under their land, they must find and contact the mineral owners and offer to purchase them.

What are OGM rights?

Texas and some other oil-, gas- and coal-producing states have long allowed property owners to separate surface rights from rights to what lies underground (such as oil, gas, or minerals, known in the industry shorthand as OGM).

Do mineral rights transfer when the property is sold in Louisiana?

Unlike other states, Louisiana mineral rights revert back to the original owner after 10 years from the date of sale or from the date of last production. Special care must be taken when dealing with Louisiana Mineral Rights in Louisiana because of Louisiana's Napoleonic law system.

How do you determine the value of mineral rights?

As a mineral rights value rule of thumb, the 3X cash flow method is often used. To calculate mineral rights value, multiply the 12-month trailing cash flow by 3. For a property with royalty rights, a 5X multiple provides a more accurate valuation (stout.com).

What happens if you don't own mineral rights Texas?

Mineral rights don't come into effect until you begin to dig below the surface of the property. But the bottom line is: if you do not have the mineral rights to a parcel of land, then you do not have the legal ability to explore, extract, or sell the naturally occurring deposits below.

Who owns the mineral rights to my property in Texas?

Mineral rights in Texas are the rights to mineral deposits that exist under the surface of a parcel of property. This right normally belongs to the owner of the surface estate; however, in Texas those rights can be transferred through sale or lease to a second party.

Can you inherit mineral rights?

Remember, the property and the mineral rights are two separate entities. You may have inherited the mineral rights, but you need to know who owns the property if you want to drill. The opposite scenario is to check who owns the mineral rights on the property you inherited.

Who owns mineral rights?

Ownership of the mineral rights is vested in the State; Land purchased by tribes and registered in the deeds office (± 1 000 000 ha).

What does retain mineral rights mean?

A mineral owner's rights typically include the right to use the surface of the land to access and mine the minerals owned. This might mean the mineral owner has the right to drill an oil or natural gas well, or excavate a mine on your property.

How much are mineral rights worth in Texas?

As a general rule of thumb, the value for non-producing mineral rights will nearly always be less than $1,000/acre. In most cases, the mineral rights value in Texas for non-producing minerals will be $0 to $250, but producing minerals – $25,000+ per acre is not unusual.

How to profit from mineral rights?

In order to profit from mineral rights, you'll need to understand the ownership and royalty process. A mineral rights attorney will be able to explain these simple aspects of mineral estates, as well as more detailed aspects of mineral estate and surface estate laws.

What happens if you have mineral rights?

If you possess mineral rights on any real property, you may benefit from a great understanding of your rights and potential profitable claim with the advice and guidance of a mineral rights attorney.

Benjamin Franklin Sc Elmore

I disagree with the other answers as an oil and gas lawyer myself. All leases are negotiable. 1/8th is low and was the market rate in the early to mid 1900s. Depending on where you are located you can get as high as 1/4 royalty.

Shannon Katherine McDonald

1/8 royalty is a pretty standard amount. Unless you have a very large piece of land and/or a very good prediction of an oil or gas reserve under your land, you will probably not get any more than 1/8. You should be able to ask an oil and gas attorney about pooling clauses, which...

Bryant Keith Martin

Generally those leases are a standard form and are not negotiable. A lawyer might help you with a pooling Agmt. The only oil and gas lawyer I know is: MIKE McREYNOLDS, ESQ. FAX NO. (210) 212-8952 Mike is in San Antonio Texas...

What advice does James Decker give when the land man comes to call offering a lease for mineral exploration?

When the land man comes to call offering a oil lease for mineral exploration, James Decker’s advice is to make sure a lawyer reviews the paperwork.

Why is it up to the landowner to try to work with the reasonable oil producer?

Decker says the landowner involved in an existing lease typically is in a weaker bargaining position because the oil company is essentially just expanding its ongoing activities.

What is the leverage of a landowner?

Decker says the landowner’s leverage in negotiations is generally dictated by the amount of land he controls and the competition for its mineral wealth. Owners of large tracts, for instance, typically have more leverage than a landowner with 50-100 acres.

Is oil royalty negotiable?

The oil royalty payment is also negotiable. “The old standard in this part of the world was a ¹⁄8 royalty, or 12½%, to the landowner, but it’s more like 3⁄16 today. Thus, if 100 barrels come out in a day, the mineral owner would get a check for ¹⁄8 of that value, and the oil company would get 7⁄8. Of course, the oil company has to pay for all the costs of drilling and operating the well out of their portion,” Decker says.

Who has the right to lease minerals?

Mineral owners have the right to lease their portion of minerals, also called the “executive right.” If more than one mineral owner is involved, only the ones with executive rights have the right to lease their portion of the minerals.

Why do oil companies deny landowners their royalties?

Oil and gas companies may miscalculate royalties or intentionally deny landowners their rightful royalty payments to boost their own profits. Companies save billions in royalty payments every year by claiming inflated drilling expenses, piling on inappropriate fees and misrepresenting production volumes.

How do mineral owners get damages?

Mineral owners often suffer damages at the hands of oil and gas companies through improper payment of royalties or negligent treatment of mineral resources. Seven common types of disputes often arise regarding the mineral owner’s rights and terms of a lease agreement.

What does it mean to enter into a lease agreement with a developer?

Entering into a lease agreement with a developer means the mineral owner is authorizing the exploration, extraction, and marketing of certain subsurface resources during a certain time period, usually in exchange for royalties.

What are the minerals in the surface estate?

Most states include oil, gas, salt, uranium, and sulfur as part of the mineral estate, while the surface estate includes sand, gravel, stone, limestone, surface shale, near-surface (within 200 feet of the surface) iron and near-surface coal. Groundwater is also included in the surface estate.

Where are the richest shale deposits?

Landowners located in top-producing U.S. shale plays like the Bakken, Barnett, Eagle Ford, and Haynesville-Bossier are sitting on some seriously valuable property. Deposits in these regions are considered among the world’s richest, with some Eagle Ford landowners collecting over $12,000 per acre for leases with developers.

How long does it take to get a written notice from an oil company before drilling?

Another statute that aims to protect surface owners from oil or gas company disruption is the “Common Courtesy Act,” requiring oil and gas developers to give surface owners 15-days’ written notice prior to entering the property for well drilling or maintenance.

What to do if you buy land without mineral rights?

In short, if you are buying land without mineral rights, the best way to do it is to research and do due diligence BEFORE buying the property. Once the surface rights and the mineral rights are severed, you can’t do anything about that.

What is required to purchase land without mineral rights?

They can help ensure that you make an informed investment decision. 6. Due diligence is required prior to purchasing land without mineral rights. When you purchase land as an investment, due diligence is always required.

What are the rights of real estate?

To start with, you should know that there are different kinds of rights associated with real estate in the United States, and two of the primary rights are surface rights and mineral rights. These rights determine how you can develop, use, explore, and extract what’s on your property.

What happens when you sell mineral rights?

When mineral rights are sold, a small number of surface rights are often included in the transactions, and it allows the mineral rights owner to set up a reasonable workspace. If you feel this could intrude on your original intention for the property, then you may want to reevaluate purchasing it altogether.

What is co-ownership in land?

Co-ownership occurs when the surface rights owner wants to retain a partial stake in the mineral rights of the property. To do this, they would sell off only a percentage of their mineral rights. They may also sell a specific section of their mineral rights (in terms of land area) to several different buyers.

Why are mineral rights so tricky?

Mineral rights get tricky because they’re automatically included as a part of the land in property conveyance…until they’re not.

How many levels of land ownership are there?

Land ownership ultimately has two levels, and it’s worth investigating the rights you’ll have as a landowner before investing in the land, especially if you suspect that it may contain minerals.

How to reduce mineral tax burden?

Many mineral owners reduce their tax burden by using “depletion”. Depletion is calculated by comparing your royalty income to other sources of ordinary income. It’s a fairly complicated formula, so it’s not a bad idea to work with a reputable tax professional to ensure you get the numbers right.

How are lease bonuses paid?

Lease bonuses are paid as a set dollar amount for each acre of land in the transaction. For example, if you had 100 acres and the lease bonus was $100, the total payment would be $10,000. There are two parties involved in mineral leases. As the mineral owner, you are known as the “lessor”. The company or person drilling for oil or gas on your ...

How are oil and gas royalty payments calculated?

Royalties are calculated as a percentage of the revenue from the minerals extracted from your property.

How much royalty do you get for every barrel of oil?

For example, if oil is selling for $60 per barrel and the you negotiated a 1/16th royalty, you would receive $3.75 for every barrel of oil recovered from your land. Royalty payments are subject to federal, state and, sometimes, local taxes.

Can you collect royalty payments without Uncle Sam?

Let’s take a look at a handful of payment and tax scenarios so you can collect royalty payments without receiving collection calls from Uncle Sam. Long before you receive a royalty payment, you will typically receive a “lease bonus” payment. These payments are reported as ordinary income on your tax returns.

Is mineral lease royalty income?

While royalty payments from mineral leases are considered ordinary income, money from the sale of mineral interests is not. In this case, your income is categorized like any other real estate asset transaction and a long-term capital gains tax is assessed.

What is mineral lease?

A mineral lease is a contract in which the mineral servitude owner (Lessor) grants to the Lessee the right to explore for and produce minerals. The parties to the contract are, generally, free to include whatever terms and provisions mutually agreed upon.

When does ownership of minerals begin?

Ownership of minerals begins only when you pump the oil and gas out of the ground and put it in a tank or a pipeline. Ownership begins with possession. Prior to possession the landowner has only a mineral servitude. 2.

What is mineral servitude?

A mineral servitude is the right to explore for minerals and bring them to the surface. The landowner usually leases this right to companies in the exploration business.

How long do you keep mineral servitude?

You keep your mineral servitude as long as you own the surface. If you sell the surface and reserve the minerals the minerals will then pass to the current surface owner after ten (10) years of “non-use” of the servitude. The drilling of a well (even a dry hole) is a “use” that starts the running of another ten year prescriptive period. If you do not own the surface you must make some good faith effort to use your servitude (drill a well) every ten (10) years in order to maintain ownership of your mineral servitude.

What are the minerals in Louisiana?

Minerals include oil and gas, coal, gravel, soil itself, sulfur, underground water, and “other substances occurring naturally in or as a part of the soil, or geological formations on or underlying the land”. 2. What law governs minerals in Louisiana? Louisiana law, not federal.

How long is a lease term?

c) Primary Term: The length of the lease. The primary term is usually three (3) years, but can never be more than ten (10) years. Shorter is better for the landowner.

How long does it take for a company to clean up after drilling?

Make a written demand upon the company that they clean up their mess. Consider legal action if not cleaned up within thirty (30) days.

Why lease mineral rights?

Essentially, leasing mineral rights is a great way to retain the ownership of your property in hopes that a successful drilling operation will lead to a steady stream of oil and gas royalties. Read more about the pros and cons of leasing mineral rights.

Why does a landman want to lease your land?

It happens all of the time. A landman has approached you and wants to lease your land in order to extract oil, gas, or other resources that can be sold in the market. Are you getting a good deal or does the man at your door simply want to turn a profit?

What is joint oil and gas lease?

Joint – Joint Leases combine two active oil and gas leases into what is known as a “joint operating agreement (JOA). In a JOA, operators agree upon a community lease in which assets are shared and new royalty percentages are defined.

Why are oil and gas lease bonuses important?

Oil and gas lease bonus payments are great, in that they guarantee a landowner is compensated for their time. If no oil or gas is ever extracted from the land, landowners will not be able to receive oil and gas royalties, because nothing was extracted and sold.

What is oil lease?

Oil and gas lease is an agreement between a mineral owner (lessor) and a company (lessee) in which the owner grants the company the right to explore, drill and produce oil, gas, and other minerals below the surface of the earth. We aren’t calling anyone names when we say oil and gas leases for dummies, but rather, ...

What are oil and gas royalties?

After all, oil and gas royalties are a monthly payment to operation stakeholders as a percentage share from the sale of the extracted resource.

Why do oil and gas companies lease?

For over a century, property owners and oil and gas companies have come together to sign mutually beneficial oil and gas leases. In the U.S, we are fortunate to have the capability of entering into an oil and gas lease. This is in order to extract and sell the resources found below the personal property.