Posted by Dan in Houston on February 08, 2008 at 11:01:35 from (38.100.70.66):
In Reply to: O.T. - Drilling for gas posted by CB in central NY on February 08, 2008 at 07:28:37:
That's the way the oil and gas business normally operates. Landman negotiates the leasing, then the company comes in and drills. The amount of royalty you can retain and the lease bonus depends on your negotiating skills and what the going rates are in your area. The company has an idea of how much gas they might find, and that determines how much they are willing (how much they can afford) to negotiate. Hiring a lawyer is always good advice but how much land do you have? If less than 5 or 10 acres, then it might not pay to involve a lawyer. If more, then a lawyer would probably be a wise investment, but make sure you find a lawyer that knows oil and gas, otherwise you will be paying for him to get an education.
If you only own a small amount of acreage, then your acrege would be "pooled" with your neighbors to create enough acreage to justify drilling. So your interest would be proportionately reduced, and your neighbors may not necessarily have the same lease terms - they may get more or less.
And of course there may not be any gas down there, so they will just plug the well and that's the end of it.
It would take several books to discuss this topic, but chances are this could be a good deal.
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