Ohio surface owners with old reservations: You might own your mineral rights

In 1989 Ohio passed  code 5301.56 which dealt with dormant mineral rights. This law was also updated in 2006 which is what most people might be familiar with. The original law passed in 1989 listed saving events that had to happen in order for the mineral rights not to vest back with the surface rights. It required no notification or action to be taken by surface owner. If you own surface rights to a  property  that had no saving events between 1969 and 1989 you could possible own the mineral rights right now. A surface owner used this argument in 2010 after the 2006 amendments to the dormant mineral rights acts had passed requiring notification to mineral owner. The surface owner proved through title and affidavits no saving event occured between 1969 and 1989 and therefore they now owned the mineral rights and the judge ruled in their favor. Case is Wiseman vs Potts. THe defendents in case tried to argue the amended  statue required notification but  plantiffs argument was successful because the mineral rights had automatically vested back in 1989.

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Replies to This Discussion

Permalink Reply by Belmontlandowner on January 24, 2012 at 6:32am

According to the case of Wiseman vs Potts, the law that was in effect in 1989 gave the rights back to the surface owner if no event occurred in the 20 years preceding.  The case also made clear what ' the subject of' a deed transfer of mineral rights meant. I can send you the court record. I'm not sure that it can be done without argueing it in court. SInce the law in effect between 1989 and 2006 did not require any action on the part of the surface owner to regain the mineral rights the rights should have automatically vested back to the surface owner. That is the argument.

Permalink Reply by Finnbear on January 24, 2012 at 7:36am

Please do send me the record. I'd be interested in looking further into this. If what you are saying holds true, then most of the old reservations automatically expired after 1989 if nothing happened with them between 1969 and 1989. This creates a county recorder's nightmare because there has to be some legal record indicating the rights have vested back to the surface owner. It would be nearly impossible to track every reservation and then document that it had expired.

Permalink Reply by Jarrad Stephens on January 15, 2012 at 4:16am

My family currently has some property in Monroe County. The previous lease was originally held by Strata. The lease had a depth clause of 3,999 feet. Information I have gathered states that the Marcellus and Utica are at depths of 5,000 feet and lower. The lease was aquired by Exxon. I think we still have some bargaining power for a pretty good payout. What does everyone think? Looking for some insight as to what is happening back there.

 

Thank You

Permalink Reply by SA Frank on January 15, 2012 at 11:43am

I would say that you would be free to lease with whoever you want, if your lease was only for surface to 3999 feet.  You should have a good bit of bargaining power to either use for Exxon or another company.   Good for you! 

Permalink Reply by Jarrad Stephens on January 15, 2012 at 12:01pm

I was just trying to stir up the pot a little and see if anyone has experienced the same situation. If there would have not been a depth clause I think it would be a done deal. I have also read that although the oil companies are trying to aquire a 640 acre pool that not all wells drilled contain 640 acres. Do you know anything about any of this? My uncle and Grandpa have approximately 570 acres so I am kind of researching the whole pooling thing....Thanks for the insight.

Permalink Reply by Billy Park Whyde on January 16, 2012 at 5:12am

 I talked with the ODNR asa I have had 3 clinton wells drilled upon my property. The requirement for those wells at about 3000 feet was 20 acres and 300' from property lines. I asked about the Utica and was told for the depth required 40 acres with 400' from property lines. THIS IS BASED UPON VERTICAL DRILLING.

  So a Utica well can be drilled on a lot less acreage than 640 Acres and probably are as vertical wells as exploratory wells not really being considered for full blown production. It could be put into production on a limited basis though to hold larger tracts though I'd bet.  

   

0i7okn54zwbdoPermalink Reply by 0i7okn54zwbdo on January 19, 2012 at 8:04am
The only 640 acre unit I've seen was in Belmont, and that was for two Marcellus laterals. I've seen permits here in Mahoning county for under 130 acres with short laterals.
Permalink Reply by k farmer on January 19, 2012 at 7:51am

Jarrad

Here is the bill of sale from Wellington/ Strata to XTO.   I would make sure your family's land isn't on there.  It seems the retained everything above 3999'.

http://www.slideshare.net/MarcellusDN/wellington-resources-and-exxo...

Hope is helps

Permalink Reply by SA Frank on January 28, 2012 at 3:02am

Until they frack the well and produce, i don't think that anyone can know  (gas vs. liquid).  Best way to know is wait until it is fracked then go see if they are hauling away oil/liquids from the site.  Look for tanks on location for storage, count the number and post it on GMS.  Look at the flare when they flare it, better yet...take a picture and post it here as well.   Unfortunately, we will probably have to wait until production is released to state in 2013 for real numbers unless some happy landowner wants to tell us their royalty. 

Permalink Reply by Finnbear on January 28, 2012 at 9:57am

mdn??

Permalink Reply by Finnbear on January 24, 2012 at 3:50am

So Exxon holds your shallow rights down to 3999 feet? Is there a producing shallow well on the property? Is the property part of a drilling unit containing a shallow well that is not on  the property? Is Exxon now paying the royalty on that well?

If the original lease was limited to 3999 feet and above, then YOU still own the deep rights.

Permalink Reply by Jarrad Stephens on January 24, 2012 at 6:11am

Unfortunately, Wellington/Strata still retains the right to the from the surface to 3,999'. Exxon aquired the lease. Exxon now has the rights from 3,999' and below.The differnece between the Beck deal and this one is that the Beck lease was already pooled together. From what I understand this lease is not. I know the family has an attorney working on this but I was trying to gather a little info myself. I think this is a good thing and they might be able to negotiate some sort of a bonus payout...just don't know.

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