Landowners, Others Seeing the Impact of Energy Investment

by Garry Hoffmann  on Monday, Aug. 27, 2007 12:00 am  

"I feel that people ought to seek out legal advice when they do their original land lease, not so much for the big money or the big royalty check, but for the oil company's use of your property," Wyatt said.

"They're after what's underneath and we're trying to make a living from what's on top, and sometimes we butt heads."

Royalty Owners Form Group

Brown said landowners needed an advocacy group, explaining why he and three others established an Arkansas chapter of the National Association of Royalty Owners. A few days before the chapter's first annual meeting at Harding University in Searcy, Brown said membership stood at about 65. "Arkansas has had its share of snake oil salesmen and carpetbaggers with this push to get acreage leased," Brown, the chapter president, said in an e-mail.

"I get two to three inquiries a week from people in Arkansas asking me to look over their lease, and I tell them I'm not an attorney."

Wyatt sounded a similar theme.

"Up until this little gas boom hit, mineral rights was just something we had but we didn't talk about it," he said. "It was a non-issue."

Now, he noted, land values are through the roof.

"A fellow auctioned land off that a couple of years ago would have gone for $800 to $900 an acre; he sold it for $4,640 an acre, for nearly 100 acres of land."

Closer to home, Wyatt said, "some kind of investment company" offered him $8,300 for the mineral rights to just 2 acres.

"We were tempted but Dad and I talked," Wyatt said, and agreed that it was more than a "just-sign-at-the-bottom" deal. "If they're willing to pay that kind of money for the minerals, there's no telling how much they're worth. That $8,300 might turn into 30, 40 or 50 thousand over the life of the lease."

Despite his daily interaction with the industry, Wyatt said gas production remained a mystery.

 

 

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