SALEM, Ohio — The region’s shale-leasing boom has ignited a gusher of offers to buy mineral rights, and landowners need to use caution when considering such deals, a local oil and gas lawyer warns.
Alan D. Wenger, an attorney with Harrington, Hoppe & Mitchell, says some landowners stuck with older oil and gas leases are being offered attractive payments that may rival bonus payments offered in the newer shale leases.
But these deals often involve an outright sale of the property’s mineral rights, a transaction that would transfer away royalty opportunities that could be substantial.
“This is not the time to see dollar signs and start signing papers,” Wenger said. “But that’s the result some of these outfits offering to buy mineral rights are hoping to create.
“Many landowners who already had oil and gas leases when the shale leasing boom started feel they’ve missed out. So when they’re offered payments that rival what the shale leases are offering, they’re impressed. But they need to realize these transactions are sales, not leases. And they need to make sure they understand what they’re being asked to sign.”
Mineral rights should be appraised properly before they’re sold, he points out. Also, landowners who consider selling their mineral rights need to know what protections and privileges they would lose in such sales.