Petro drilling near my neighborhood, need advice

[sniper7]

I've got a couple different registered letters I believe from the same company and I just tossed them before, but this packet seems pretty legit and offers $500 plus 17.5% royalty and a 5 year primary term.
they also offer the option to pay to invest in one or more wells or the third option is to be considered a non-consenting owner under rule 530, section 34-60-116, CRS and it says I would get 12.5% of production if any to my tiny interest in each well. .007752% to be exact.

my issue is I am planning on selling the house hopefully this summer and want to know how any of this would impact the sale, if it would be disclosed during the selling process, what about legal ramifications should the drilling company screw up and mess up the house or contaminate the water or something to the effect.

anybody deal with this before?

[USMC88-93]

Presumably disclosed as wouldn't this transfer to the new owner of the property?

[UncleDave]

17.5% is on the low side for Colorado, at least it was 4 years ago. Try for 20%, leases were going 24-26% a couple of years ago at least in Weld and Larimer counties

[Irving]

What is the $500 for?

[newracer]

First are you sure you even own the mineral rights now?

[sniper7]

I have no idea if I own the mineral rights. Not even sure where to find out if I do?

[sniper7]

Yeah I expected to have no mineral rights since it was a big builder and I believe multiple builders owned the lots at different times which would make it even more susceptible to being stripped of the mineral rights.
The letter says I appear to own 51% of the mineral rights.

[Wulf202]

I got one recently for $168 and 15% from a middle man company as hbar described. First one was $5 and 10% a few years ago

[Great-Kazoo]

Presumably disclosed as wouldn't this transfer to the new owner of the property?

Not unless the seller includes it with the house sale

17.5% is on the low side for Colorado, at least it was 4 years ago. Try for 20%, leases were going 24-26% a couple of years ago at least in Weld and Larimer counties

Not anymore. 4 yrs ago The US was rocking O&G . By 2/1/16 some of the largest O&G producers, drillers etc will be shutting down, laying off and fairly sure stopping any orders for 2016-17.

Yeah I expected to have no mineral rights since it was a big builder and I believe multiple builders owned the lots at different times which would make it even more susceptible to being stripped of the mineral rights.
The letter says I appear to own 51% of the mineral rights.

Yes you do. If i were you. I'd sign, wait the 4-6 weeks till you get the bonus check and call it good. If you or anyone doesn't respond to the 2-3 ;etters you'll receive. Your share goes in to a general pool. That means what ever the general pool is being paid, if anything. Is what you will receive, If you don't sign.

We have O&G and water rights in town. The drilling that was suppose to happen, isn't. Or will any more drilling happen for the next year or 2. Maybe more. That bonus $$ was put toward the mortgage.

I have a copy of our contract an atty did some adjustments on prior to signing. You're welcome to browse it making changes to your contract as necessary.



Hear that sound? it was the housing market imploding. Hope those hipster old town ft fun home owners have a nest egg saved. cause it's about hatch.

[ColoradoTJ]

Well, I can touch bases on this topic a little, but I don't own mineral rights in Colorado. However, I do own mineral rights in North Dakota where all the boom was going off. Three wells to be specific. One of my uncles has twelve wells on just one of his that he owns the mineral rights.

First off, never sell the mineral rights. I am actually surprised you have them and a developer didn't keep them for himself or sell them off. The company is just feeling you out. I have had several offers and I decline every time. These are worth some money.

Second, open up a family/oil trust fund. Make sure you get a tax ID number and don't use your SS number. Trust me on that one.
- Declaration of Trust
- Have living will with all paperwork
- Have mineral Deed with all paperwork
- Power of Attorney (general), Medical Power of Attorney

You should consult a good tax accountant. It is expensive, but so worth it.

Once you start, you will get the company investment monthly dividend and what was deposited into your trust. Keep good records of all expenses. I cannot express finding a firm that has a buttload of experience in trust funds and how to write them.

I posted a picture of two of my wells. This is not to brag, but to inform. I covered up all my information, but as you can see what gross/net came from the wells. This is where you get your cut depending on what percentage you get.

Some me people go buck wild when they start seeing this cash flow, but I would just leave it in the trust unless you really need it. I most likely will never touch this money. I paid for both of my parents cancer treatments/surgery without issue. One less thing to worry about.

When you see gas prices at 2.75 or more, life is good.