Legal Question in Real Estate Law in Canada

leasing property with mineral rights

A Canadian investment service has drawn up a contract on behalf of an oil company that is willing to cover legal fees on the appointment of a legal representative for the estates of two relatives (selected by this Canadian investment service) for lease of property that the beneficiaries have mineral rights to.

Are the following fair and equitable lease terms? What else do we need to consider or know?

Bonus Consideration: $30/acre

Term: five years

Lump Sum Rentals: $4/acre

Royalty: 15%


Asked on 12/02/06, 5:32 am

1 Answer from Attorneys
C. David DuMond Law Offices of David DuMond

Re: leasing property with mineral rights

This is probably a scam.

http://www.in.gov/sos/desk/contact/securities/

Contact the Indiana Securities Division to learn if these oil and gas interests are registered securities for sale in Indiana and whether the Canadian investment firm is registered as a broker dealer or investment advisor.

It is impossible for a private investor who has no experience in the business to make rational investments in the oil and gas business. You need to deal through a trusted broker-dealer. Good luck.

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Answered on 12/02/06, 10:52 am


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