State your

1. State
2. County
2. Lease Bonus Offer
3. Royalty %
4. Terms (length of the lease)

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First, the "Register" is actually the Recorder of Deeds, which is usually the same person as the Register of Wills, this typically being the case in the smaller counties.

Second, yes, in the US if you have a fee simple deed that covers all of the property rights (e.g., surface, O&G, coal, clay, limestone, right of support, etc.) and has a uniform boundary for all of those rights, then your property essentially would go to the center of the Earth. However, there may be various rights sold off, including rights as fractionalized as something like the selling off of the Kittanning vein of coal or the coalbed gas, which would be an exception to the center-of-the-Earth idea. Also, the boundary for your property rights may not be uniform to the center of the earth. For example, a prior owner may have owned 100 acres and reserved all of the O&G rights for the full one hundred acres before selling off a 25 acre tract. Then he may have reserved all of the coal for the 75 acres he had left before selling off another 25 acres. Then he may have reserved all of the timber, clay, and limestone for the 50 acres before selling off an additional 25 acres. At that point you buy the 25 acres and he conveys all of the property rights that he has that are associated with his tract. In that case you would have different boundaries for all of those various rights. That's why it's so difficult for a person to be sure they own their OG rights or those OG rights are not leased since the reservation of the gas rights under your property may have occurred as far back as 1859, in which case your legal industry standard 60-year title search wouldn't reveal this issue. This is also why you shouldn't count your chickens before they're hatched - or shouldn't count your cash before your check clears. Nothing is as simple as it appears. In fact, an even more difficult situation is where a landowner had 500 acres 100 years ago and signed one OG lease for the full 500 acres, which permitted one well to hold the entire tract by production and payment of a $50.00 per year royalty payment. Then at present day the 500 acre tract has been sub-divided 50 times with parcels anywhere from 100 to 1/10 acre. There is one well on the original 500 acre tract and the owner still gets the $50.00 per year payment. That lease, most unfortunately, is still valid and is very difficult to track down for the various property owners. Actually, that was the case (at least originally) for the 800ish acre landowner group that was featured in the "Haynesville" documentary (which has been airing on CNBC). Although, after a lot of research, fortunately for that landowner group the leaseholder - now ExxonMobil - supposedly never drilled a well on the leased property.



DISCLAIMER (i.e., CYA – I suppose CMA): Attorney-Client Privilege/Confidentiality is not established and does not apply to either questions or responses. Hence, do not disclose any confidential information (which would be really stupid anyway since thousands of people are reading this stuff). Responses are not to be taken as legal advice. Only one piece of legal advice is being given: HIRE YOUR OWN ATTORNEY TO HANDLE YOUR OWN SET OF FACTS AND DISTINCTIVE LEASE TERMS AND ISSUES! A brief recital of facts and issues in a discussion forum can NEVER convey all of the facts in each idiosyncratic case. Likewise, a brief response to those incomplete set of facts and issues in a discussion forum can NEVER convey a functional analysis of your unique situation, and, as such, cannot be relied upon by you as legal advice for your unique situation. Believe me, fact situations are about as similar as fingerprints. Moreover, all of my responses are talking about Pennsylvania law because that is where I am licensed. That means if you are from outside of Pennsylvania you can go ahead and throw everything I said right out the window (darn, I was trying to make it through this without resorting to a cliché . . . or a French word). Thus, while my responses might be free, they are not legal advice. Do not be so stupid as to try to save $1,000.00 whenever you have the opportunity to make $100,000.00. So take it from Warren Buffett – “Price is what you pay. Value is what you get.” If you do not pay the price you will really pay the price. I hope I avoided ticking you off, but hey, wasn’t that a great disclaimer!
Bryan can you recommend a good oil and gas attorney around the area of Kittaning, (Armstrong Co.) is this something that you do?

Michael Studer
studer6@aol.com
269-921-1290
Yes.

I hope this is not a repeat of my prior question ( seemed to have lost it ).  Regarding title to property, if I signed a O and G lease but am involved in quiet title action which I started on a piece of land due to relatives coming out of the wood work.  Will a quiet title action normally cause  problem when the title search is done or will they rely on the present holder of the title and let the parties in dispute settle any their own differences.  For instance, if Exxon comes I sign a lease with them but am in court with my 2nd cousin who is making an absurd claim that he owns part of the land, it seems to me exxon would only care that I am currently the owner ( not being an atty  of course ).  If later it is found that the cousin owns 50% well thats between me and the cousin right?

 

I have a variety of things on this but not from an atty.  One friend actually has 100 acres that are in bankruptcy and it has two liens on it.  One from a real estate company and one from the bank yet the O and G company still went ahead with the lease and all parties, including the bankruptcy judge don't mind.  The money was paid to my friend but of course the court knows about it. 

 

I simply don't know what the O and G companies really want on their search.  A pristine title search everytime or will they accept some things that are less than perfect as long as you are currently the owner.  Title disputes could come along at any point before, during and after signing a lease so how could Exxon or any other company get involved in every case that comes along?  Thanks much.

They will do a title search of their own before writing a check. If they come across your legal issues (and they will!) or any other questions about ownership they will probably do one of two things: 1) They may cancel the lease entirely
2) If they really need your acres for a drilling unit they can write the check and then the lease bonus will likely be placed in escrow until the ownership dispute is settled. No one gets the benefit of the lease bonus money as it will be tied up until the matter is settled. You really can't sign a lease until you are 100% certain (via a title/mineral rights search) you own the rights, lock, stock, and barrel. Probably not what you wanted to hear but reality. Oil and gas companies don't have time to be involved in disputes like this and the safe route for them is to escrow the payment until it is settled and get on with other business.
They will do a title search of their own before writing a check. If they come across your legal issues (and they will!) or any other questions about ownership they will probably do one of two things: 1) They may cancel the lease entirely
2) If they really need your acres for a drilling unit they can write the check and then the lease bonus will likely be placed in escrow until the ownership dispute is settled. No one gets the benefit of the lease bonus money as it will be tied up until the matter is settled. You really can't sign a lease until you are 100% certain (via a title/mineral rights search) you own the rights, lock, stock, and barrel. Probably not what you wanted to hear but reality. Oil and gas companies don't have time to be involved in disputes like this and the safe route for them is to escrow the payment until it is settled and get on with other business.
Daniel Rupert
Thank you for this. A lot of good info.
PA
Lycoming County
$4,500/acre
18% no deductions
5 yr non-renewable lease
Jeff - Can you tell me what company this is with?
1. PA
2. Clarion - Knox Borough/Elk Twp. Area
3. $2,500
4. 15%
5. 10 years
what company is this with?
All this is kind of interesting, but try Googling Barnett shale and find out what Texans pay Texans for shale that is not as valuable as the Marcellus - and nearly all the leases around here include all the oil and gas which means other strata that could be as valuable or more valuable than the Marcellus.

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