I originally posted these questions in the "Blog" and got no response. A member graciously suggested I post it on the Shale site. I hope I am in the right place now. Thanks,
'Being new to the group, I have some learning to do. I am selling my surface land and retaining all mineral rights. I want to allow the buyer to have rights for a gas well for his home use and to share half of the royalties if any from that well. There are no wells on the property at this time. I understand that the deep well/shale drilling production does not present gas usable for surface owner use. If that is correct, would allowing him to pursue drilling of a shallow well for his purposes affect my ability to sell or to lease deep well gas rights? Also, if no well is drilled on the surface property but gas is drawn from horizontal legs from the property, I understand that royalties for that gas taken from adjacent property is not paid on a metered basis but on a percentage of acreage included in the rectangular drilling space. Am I correct? If someone would enlighten me , I would be appreciative. Thanks..'.
Your comment about working with a high level of trust between the buyer and seller is very important. I think I would be better able to negotiate a lease with a company and provide something benefiting both of us.. I think we can agree to that.. Time will tell. Thanks for your helpful comment.
Drill Baby Drill, you and apparently most of the members who have commented to my posting agree that complete separation of the Mineral Rights from the Land Surface Sale is best for both the Buyer and the Seller. I am going to try to negotiate that with the Buyer.. Thanks for your helpful input.
I , too, can understand a buyer's reluctance not to have the mineral rights transferred with the land but it does appear that is going to be a "thing of the past" in areas with potential exploration. I would think there are some guidelines in State Law about the rights of the owner vs the mineral right and/or lease holder but maybe I am being naive. Perhaps purchase contracts have to address this. That leaves the door wide open for very complex, convoluted language. All the more reason to keep the surface sale totally separate from the mineral rights. The irony of the whole situation is that no one really knows if anything will come of the speculation in our area. We just don't know whether government restrictions are going to play a big part and we don't know until we do some drilling if there is anything to be gained. This entire scenario must be fertile opportunity for attorneys specializing in this field.
I live near Cincinnati but the property in question is in Morgan County, Ohio. Any thoughts about the potential there? I realize the maps and data I have been reading put it on the outer edge of the high potential area. BTW where are you located and have you property in Ohio?
I just saw this link and wondered if we possibly are talking about Oil rather than Gas in the Utica area,, even on the outer fringes of the rock,,(Morgan County, Ohio)? Just curious. http://www.anadarko.com/Investor/Pages/NewsReleases/NewsReleases.as...