Buying land with oil & gas operations on it?

[strantor]

I'm looking to buy some land and there's one property I'm interested in, but it's on an oil field. The price is very good compared to other properties around the area and it has been on the market for a while. Makes me hesitant. Good, reasonably priced land sells within days around here. The land backs up to a bayou and I know that it floods. I would be building up considerably to put a house on it. Half the land around here floods and people still pay high prices for it, so the flooding doesn't tell the whole story.

Another potential red flag is that it's totally wooded. 90% of the surrounding areas are rice farms or used to be rice farms. The fact that it was never deforestated and turned into a rice field tells me, at a minimum, that it is unsuitable for farming rice. I don't care about that. I'm not a rice farmer. But does it signify something more? Is the land unsuitable for any other purpose as well? I actually WANT wooded land. Wide empty fields are bleak to me.

The only good reason I can figure for the low price of the land and its failure to sell, is the oil operations. On Google earth I can see a few tanks on it, looking old and rusty. Does not look like there's a whole lot going on, and those images are old. I imagine there's even less going on now.

I have some financial preparations to make before I approach the realtor, and between now and then I intend to become better informed and know what are the right questions to ask. I used to service oil field equipment so I know a bit about the technical side of drilling and whatnot, but I know little about oil field operations and even less about how those operations impact landowners.

Do any of you have land with oil operations on it? What wisdom can you bestow? What should I know before walking into this? What questions should I ask? What answers are deal breakers? Is this a safe place to move my family to?

 

[JimRB]

A friend owned 30-40 acres up in Ohio and he did not have oil/mineral rights to the land. He did get all the free natural gas he wanted though. A friend that used to live in Texas has talked about mineral rights before.

Do you know how high the water gets on the property? If it is 30 feet under water then that would be a lot of fill to get your house, tractors, cars and trucks up on safe dry land.

 

[strantor]

A friend owned 30-40 acres up in Ohio and he did not have oil/mineral rights to the land. He did get all the free natural gas he wanted though. A friend that used to live in Texas has talked about mineral rights before.

Do you know how high the water gets on the property? If it is 30 feet under water then that would be a lot of fill to get your house, tractors, cars and trucks up on safe dry land.

I do not know this for a fact, but I can say with reasonable confidence that mineral rights are not included. Not at that price, and with oil operations already ongoing. So I don't want this to turn into a discussion of mineral rights, unless they effect me in some way that I'm not aware of. When I try to google on this topic, all I find are discussions of mineral rights. None of that applies. This is just a topic of surface rights and how surface owners are impacted by mineral operations.

I do not know exactly how high the water gets. The property is in the 100yr flood plain. I know the "neighbors" - the people who live about 1/4 mile south. Their house is built on a mound I would estimate to be about 8ft higher than the surrounding land. I assume that further into the process I will have to get an elevation survey done, which will tell me how high structures will need to be built up to be safe. I intend to dig a rather large pond to obtain the dirt needed. Maybe I'm being naive, but I think I could probably do the work myself on weekends over the next many months with my 40hp tractor, as this property is within tractor driving distance from my current residence.

 

[inthe country]

If your planning on a purchase of land without the mineral rights, you need to know many things. Is there an existing lease on the property? You will want to see any existing lease to see what the mineral owner has given the oil company permission to do on the property. Things can get extremely complicated in a hurry.

 

[hosspuller]

Consider domestic water. One can't have a well if the ground water is contaminated. A bad casing on a oil well will pollute the ground water.
Old oil & gas operations didn't have the oversight of today. They might have dumped something on the property. An environmental survey is a good idea before purchase. It may cost you a bunch, but it'll save you a whole lot more.

Can you purchase the land contingent on suitable water?

Land without water is useless for homes.

 

[s219]

I'd worry about waste and dumping activity, as well as groundwater contamination.

 

[Diggin It]

Their house is built on a mound I would estimate to be about 8ft higher than the surrounding land. I assume that further into the process I will have to get an elevation survey done, which will tell me how high structures will need to be built up to be safe. I intend to dig a rather large pond to obtain the dirt needed. Maybe I'm being naive, but I think I could probably do the work myself on weekends over the next many months with my 40hp tractor, as this property is within tractor driving distance from my current residence.

Guy down the road did that. Moved enough dirt out of a pond to raise the ground a few feet to build a house in a flood prone area. Contractor did it with very large earth scrapers similar to this:

I can't recall if they had two or three of them running, but it was most of a week if I remember right.

The house is basically on an island when flood waters are high enough. Not quite up to the porch, buy not far from it. He can't get out his driveway.

 

[strantor]

Guy down the road did that. Moved enough dirt out of a pond to raise the ground a few feet to build a house in a flood prone area. Contractor did it with very large earth scrapers similar to this:

I can't recall if they had two or three of them running, but it was most of a week if I remember right.

The house is basically on an island when flood waters are high enough. Not quite up to the porch, buy not far from it. He can't get out his driveway.

Wow. I guess it's a more demanding job than I expected. This prompted me to do some math. If I wanted a pad 100ftx100ft x 8ft high, that's 800,000 cubic feet (not counting slopes) and my loader bucket holds 16 cubic feet. That would take 50,000 trips back and forth with the tractor. If I could make those trips in 5 minutes each (probably extremely optimistic) then I could get the job done in 4,167 hours of run time. If I put in 12hr days every single Saturday and Sunday, it would only take 174 weekends (3 years and 4 months) without a single day off. And that doesn't count the time I'll spend trying to fix the tractor, pump water out of the hole, stuck in mud,
called in to work, or opting to go fishing instead. I think 10-15 years is probably the most reasonable goal I could set to get this done on my own.

I am officially abandoning the idea of doing this with my tractor.

 

[LouNY]

As has been mentioned with the mineral rights gone the water rights may have also.
And never having been cleared and farmed if you look at a topographical map of the area it would give you elevations to compare with.
Also depending on what the lease agreements cover you may not be able to excavate for a pond or to use the dirt for a building pad.
And then also environmental damage that might come back to haunt the buyer.