Oil and Gas leases

[yekrut]

Thought some of you may have some gas well experience so I'm looking for some comments regarding my situation. I have 14 Acres in Ohio. They have been drilling quite a bit around here. For the past couple months a rep has approached me with surface and non surface lease options. The variables seem to change based on what the big property owners (80 - 160 acres etc..., that's big in Ohio). Here's the latest. They sent a non surface lease (5yr) with $300 up front. I think they need my 14 acres for the unit. This gets confusing but the rep says they can go as low a 40 acres for the unit, but the lease says 160. This I think this would affect the my royalty percentage? Also, while they haven't said it I think they really need me because there is an existing well on the neighbor to the North. The neighbor to the east has signed and they want to put the well on his property. In order to do that they have to put it close to my line because they have to be 1000ft from any existing well and they can't be any closer than 500 ft to a property line that's not on the lease. If I sign I think they can be 100 ft from my line. Do these seem accurate?

 

[Egon]

Lease and royalty regulations may change for different locations. Best is to seek advice from one knowledgeable in your area.

In many cases the % return is more valuable than surface options.

 

[dmccarty]

Yekrut,

Search TBN about gas/oil leases. There have been discussions on the subject that might be interesting to you. Not only what is a "fair" price/contract but also access and access problems/messes as well as noise and pollution issues.

Seems like we just had a discussion in the last 3-6 months.

Later,
Dan

 

[randy41]

Dan is right...there was a discussion not that long ago but it was not referring to your area.
if i were in your situation i would consult a local attorney who has experience in that field.

 

[tommu56]

yekrut
Ironically I just got a call about my property up state and on the phone $125.00 per acre and 8% royalty

I called my BIL he works in the gas and electric industry he said the $125.00 acer sounded good the royalty should be 12.5 % and he thought that it was regulated by the state he is still looking in to it though.

tom

 

[tommu56]

yekrut


here is the link for pa

Land Owners and Oil and Gas Leases in Pennsylvania

ohio
Landowners and Leasing for Oil and Gas in Ohio

tom

 

[frank_f15]

you very well be advise to get the infor form a really informed person, i know many , many years ago my dad signed a lease for the gas comp. to store natural gas under our land, being i bought the land from my dad i am liable for the lease so every year they send me a check for $15 of course when the lease is up i will ask for more, on the dow side the lease was for 99 years so i only have wait 43 more years, dont think i will make it as i am 66 now

 

[yekrut]

Thanks for the good information. I'll check out the other discussions.

 

[chetorba]

Here is a web page with a good explanation of how the revenue is split amoung the lease holders in a given area of production

Oil/Gas: Gas lease