Revised drilling unit??

Hello all :) I have a question that may have been answered here already; sorry if it has, I can't find it.

If your property is held by production (1984 unitized lease) and the unit was revised to smaller acreage leaving your parcel out of the unit..( later in 1984)....does that mean you can lease your property? This is assuming you own the mineral rights to the parcel. Thanks for any help.

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Permalink Reply by Philip Brutz on May 23, 2014 at 2:45pm

Have you been receiving royalties since 1984?

Permalink Reply by Frank Walker on May 24, 2014 at 1:27am

John and Paula

During the short (presumably only several months) interval of time, in 1984, when you were in the unit:

Were you paid any royalties?

Also:

Please confirm  (if true) that ever since you were booted out of the unit you have received no royalties whatsoever, and no other payments either.

Any payments you might have received, and when you received them, matter because they could form a basis for the gas company retaining a grip on your property.  This holds even if the payments were quite small.

Permalink Reply by John & Paula Bostrom on May 24, 2014 at 1:01pm

We have not received any royalties and the owners before us did not receive any royalties. Both of the deeds say that the property has a lease on it from a oil and gas company. The title companies might have just copied off the deed from the original property without checking further into the oil and gas leases because they are worded exactly the same.

In 1998 our parcel was cut off of a larger section of land that was leased to an oil and gas company in 1972. A producing well was drilled shortly thereafter and the lessor received their due royalties. In 1984 this larger section was unitized with a drilling unit on a neighboring property. A few months after the lease was signed by both lessors the original unit was revised to a smaller unit, leaving what became our parcel out of the unit.  In 1998 our parcel was taken off of the piece that was originally leased in 1972.  The deed from the former owners for our parcel states: "Grantors are true and lawful owners of said premises and are well seized of the same in fee simple and have good right and full power to bargain, sell, and and convey the same in the aforesaid, and that the same are free and clear from all encumbrances, except taxes and assessments, if any, which are to be prorated to date of delivery of this deed."

Would this mean that our parcel is not held by production because it was not in a unit at the time it was split off and sold?

Permalink Reply by Nancy Mosley on May 24, 2014 at 1:10pm

Do you have a copy of the 1972 lease? The wording on that lease, I think, is what rules here. I am not an attorney but from my understanding of things (at lease WV law) that is how it works. If the wording on that lease says something about land not in a unit being released, maybe your tract is clear. Worth trying to get a copy of that lease.

Permalink Reply by Frank Walker on May 24, 2014 at 1:38pm

I'm not a lawyer.  The complexity of your situation might require legal analysis by a lawyer before you can be certain where you stand.

I would not label your circumstances a "mess".  But your situation is fairly entangled.

Permalink Reply by Jackie Root-CMM on May 28, 2014 at 3:46am
Is this parcel in Pennsylvania?
0ym9x5ag7ury2Permalink Reply by 0ym9x5ag7ury2 on May 28, 2014 at 3:25pm

Go to your county courthouse and do your own title search using your deed to find the previous deed Book and Page Number. As you look at the chain of deeds, any leases, right of ways or mineral rights changes to your property will show up. It's simple and cheap if you do it yourself.

In Ohio and WV when you buy property you get a title search that was performed by the closing attorneys office, which has all the details of deed transfers, right of ways, Oil & Gas leases, and Releases from oil and gas leases. It may be the same in PA, but I don't have any experience with land in PA.

Take a look at the documents you received when you purchased your property and you might find that you already have a title search with the deeds and leases you are interested in.

As when making any purchase, read the contracts and associated paperwork to find out what you are getting (or got, in your case) for your money. If it isn't written in the contract you didn't get what you wanted from that nice man who shook your hand after closing the deal.    

"Money Brings Out The Worst In People"    

Permalink Reply by John & Paula Bostrom on May 29, 2014 at 10:39pm

Thanks to everyone one for your generous help! :) We are in Franklin Twp Harrison county Ohio. I will keep researching at the courthouse.

Permalink Reply by brat on May 31, 2014 at 9:52am

Just as a side note, be prepared to stand in line waiting on a computer at the court house...maybe 1/2 hour to an hour (depending on how many landmen etc. are ahead of you.  Then you only get 15 minutes pc time.

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