Skip to comments.Mortgages for Drilling Properties May Face Hurdle
Posted on 03/19/2012 10:23:57 PM PDT by crosstimbers
The Department of Agriculture is considering requiring an extensive environmental review before issuing mortgages to people who have leased their land for oil and gas drilling.
(Excerpt) Read more at nytimes.com ...
^ that’s all I got.
Department of Agriculture Appoints itself King of America.
They aren’t the first and they won’t be the last.
Dems are monarchists, they just don’t put it in those terms. But they definitely believe in Divine Right of Regulators.
So, THIS is how the Oboma regime will “increase” U.S. oil production?
Nuts, just plain nuts.
This is typical. There are Miners and then there are those who make a living mining Miners. Next, an entire army of idle asbestos lawyers will show up and start the TV ads.”
“Does yer water taste kinda funny? Are you losing sleep ‘cause your dogs bark all night ever since that rig moved in four miles away? Do your eyes water sometimes for no apparent reason? Well, this is yer lucky day! Call the offices of the crack legal team of Dewey, ...”
Oilpatch guys, BUY THE SURFACE WHENEVER YOU CAN. It’s only gonna get worse. You are the only game in town.
OTOH why would they need FEDERAL mortgages if they have or will soon have income from gas or oil leases? A local bank would probably be able to understand their situation much better.
FYI, signing a Lease Agreement is not a sure-fired contract to send you a check each month. They will, but only if the Lease is producing oil or gas in “paying quantities”.
Mineral Lease gives the O/G developer the right to explore (drill a well) and it also specifies the details of what the Mineral owner receives in the event oil or gas are found. Not all wells drilled produce “paying quantities”.
USDA is no longer a major direct lender for rural properties, although they could be underwriting some Land Bank mortgages.
I live in the Marcellus area. When you sign up for a gas lease in PA, you get what is called a bonus payment of $1000 or several times that per acre. AFTER that you may or may not get your royalty percentage which is in excess of 12 1/2% depending on whether gas is found or not.
So if you own 100 acres the bonus payment for signing is $100K-$300K. I was just pointing out that the folks may not need a mortgage or that a local bank may be delighted to work with them.