Money Ain't Everything

Real Estate Agent with Keller Williams

I recently spoke before another HOA group who was interested in becoming a group so they could negotiate a better lease for their minerals.  I definitely support their idea about joining forces. There is power in numbers, especially in the Number of Acres you can offer to a company.

However, there are many lease terms that can be equal to, OR GREATER THAN, lease bonus when it comes to long term valuation. 

If you live in nice area in a big home the amount of bonus you are going to receive from a gas operator to lease your 1 or 2 acre tract is not going to make a lot of difference in your lifestyle.  Granted, $20 or $30 thousand dollare, as a windfall, is not chicken-feed to anyone but it isn't all the money in the world.  And you are going to need to have a couple of acres to get that much from anyone.

But if you have this big home and acreage sized lot you probably make good money anyway.  How much would you pay to not have to listen to the constant noise from a gas compressor site next to your home.  And it runs 24/7 every day of the year.  And occassionally you will have truck traffic around your home when they service and maintain the compressor.  I know it would be worth a lot to me not to have to put up with that aggravation.  But people who don't know what to ask for frequently do have this happen to them.

The thing to realize is that you need to think beyond the check they are waving in your face and think about how this will impact you and your family. 

THE MINERALS ARE GOING TO BE DEVELOPED.  Maybe not right now but they will be eventually.  You don't even have to sign a lease, or reap any benefits, to be in the position of living next to a compressor site, or treating plant.  You might just be plain LUCKY.  More about that next time.

Let me know if you have any questions.  Please email and I will get back with you.

Comments (1)


We are in the Country Lakes division.  Some of the homeowners own 25% of the mineral rights while the developer the other 75%.  He made two seperate deals with Hillwood energy:  one for himself and the 75% and one for us, the homeowners.  Our deal was $375 per acrea and a 2 year lease.  We had a lawyer review the lease and because we only own a small percentage and it was already approved by our HOA (behind our backs), financially it would not be worth pursuing.  My question is:  Is there anyway we can find out the deal Wynne Jackson made for himself with Hillwood?  Also what does the lease term do?  After the 2 year lease, what happens, do we stop getting royalties?  Thanks for your help.

Jun 04, 2008 02:37 AM