Mineral Leases for Dummies

When commodity prices are high, people crawl out of the woodwork looking for ways to strike it rich without working hard; and freelancers come out of the woodwork ready to advise them on how to do so. When gold was $1800/ounce, there were the freelancers with gold-recovery instructions. When oil was $145/barrel, there were the freelancers with typical bogus advice on how to get rich wildcatting or drilling for oil in your own back yard. Not to be left out, serial dumbass, eHow-style, Larry Parr tried to get in on the act with a little scrap of content he called "How to Buy Oil Leases."¹

We showed Larry's article to the Antisocial Network's expert on the oil industry (yes, we have one), and he sighed mightily – the same thing he almost always does when we show him eHow content purporting to be about the awl bidness. Although the title (probably) isn't Parr's fault, he found the concept of "buying a lease" to be a little oxymoronic, unless someone's buying lease rights on a secondary market (sometimes called assignment of the lease – see image). That's not the biggest problem with Larry's instructions, however...

Larry starts off on the wrong track by telling his readers that 

"...the vast majority of [oil] leases are on property owned by the federal government or a state government..." ...which is utter bull. That may be true in some western states such as Colorado and Wyoming, and it's certainly true of offshore leases and leases in foreign countries; but in reality leasing of private land is much more common than state and federal leasing. For instance, there are virtually no government leases anywhere in Texas. That simple fact renders the remainder of Parr's post, for lack of a better word, "wrong." Leasing private land entails researching ownership, both surface and mineral rights, and negotiating a lease with the owner(s). It's that simple... but Larry didn't say that. In keeping with eHow style, Larry's post is laid out as a series of steps, all of which begin with a so-called "action verb." That's now the first step in the post ends up with the inane

"Immerse yourself in all aspects of the oil exploration industry. Take courses if possible."

We found that dirt-stupid bit of advice positively laughable: what courses would you suggest? BS and MS degrees in petroleum engineering and exploration geology? Got six or eight years (and a whole lot of money) to spend in your "immersion program," Larry? What a dumbass idea... Parr goes on, still pretending that the way to "buy a lease" is through a government sale:

"Research the parcels up for lease and make your own determination of the likelihood of oil and/or gas being present."

Yow. We guess that's what Larry meant by his "immerse yourself" crap. That's a lot of research, and he didn't even say what data you'd need or where you'd get it. In the real world (as opposed to the eHow universe), we suggest that if you want to complete said research in a timely manner, you'd be wise to form a partnership with someone who knows his or her ass from a hole in the ground when it comes to oil and gas exploration. Larry's not so convinced: as far as he's concerned, your next steps are to "attend the auctions," "bid on the parcels" and "pay for the leases you've won within the time limit." We note that Larry didn't bother to mention that if you want to get in on the big lease sales -- especially offshore -- you'd better get some financial backing, because the leases can go for millions.

Nope, once more Larry Parr and eHow.com contribute to the stupidification of the internet with "authoritative" content that in actuality lacks any basis in experience or knowledge. In other words, Larry collects another of our Dumbass of the Day awards; his sixth! Sheesh...

¹ The original has been deleted by Leaf Group, but can still be accessed using the Wayback machine at archive.org. Its URL was    ehow.com/how_7198211_buy-oil-leases.html

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