What
you need to know about Leasing
Remember that mineral leases are legal documents,
so it’s important to do your homework. That way,
you can feel more confident as you consider your
options and alternatives. Together, we’re Helping
Move America’s Resources.
The Barnett Shale play is an incredible
opportunity that is already paying off for many
people just like you. But to protect your best
interests and get the most out of it, you need
to be informed.
Q. What do I need to know before signing a lease?
A. There are many factors to consider before and
during the lease process. The main consideration
is to discover who will ultimately be producing
your minerals, regardless of which company offers
you the lease. The operating company is the one
that will actually drill and produce your minerals;
possibly but not necessarily the same one that
offers you the lease. Also consider the reputation
and stability of the leasing company, the volume
of leases they have generated in this market,
the company’s relationship to the mineral producer,
and their commitment to the community as demonstrated
through corporate contributions or civic service.
Q. What operating company should I look for?
A. Well-established companies with proven track
records and drilling success rates will generally
produce a better well, which means more royalty
income for you. It’s also important to choose
an operator with the financial strength to hire
the best people and provide the best equipment,
with the durability to maintain the well for the
next several decades. There are several excellent
operators in the Barnett Shale, but there are
also young start-up companies with little expertise
or capitalization.
Q. What are the
terms of a typical lease agreement?
A. The basic lease agreement involves an initial
bonus payment for signing the lease, royalty percentages
to be paid if natural gas minerals are found and
extracted from the property, and a timeframe within
which the energy company has to begin operations.
If natural gas production does occur, the lease
is in effect for the life of the well, which could
be 20 years or more.
Q. Why is my bonus
offer different than others in my city?
A. Bonuses are generally calculated on a per-acre
basis, so your lot size may be a factor. Other
factors may include availability and cost of a
wellsite, proximity to existing pipelines, access
to seismic testing, geology of the area, offset
production and existing competition.
Q. How do I begin
the process?
A. Getting started is easy. If you own property
in the Barnett Shale region, send us an email
with your information to leasing@dfwtexstar.net.
A representative will contact you soon.
Q. I want to know
more. Is there further information I can review
about the leasing process?
A. DFW TexStar Land Services, L.L.C. has created
a leasing brochure that details the leasing process
and other important questions you might have.
To receive a free copy of this brochure, email
us at info@dfwtexstar.net.
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