WHAT ABOUT AUTOMATIC LEASE RENEWALS?

I remember reading somewhere on this site that some leases are automatically renewed without the land owner being notified until the day of expiration. In Belmont County, Gulfport renewed a lease that was paid 500.00 more per acre than the original signing bonus was for. The landowner wasn't notified until the check was cut. That goes against almost everything I've heard about the way these companies are handling these leases with many of them being let go. But so far I have not heard of anyone being given a 'release' from the agreements.... Anyone with info regarding this?    

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Permalink Reply by bo boboski on March 13, 2016 at 5:36pm

I know my lease,was Shell,now Ascent, can be automatically renewed by them just sending me the same bonus $$ as before, as long as they do it before the 5 years end.

Permalink Reply by deutchen on March 13, 2016 at 7:45pm

I just received my lease renewal payment from Gulfport 3 days ago. It came approximately a week before the 5 year lease ran out. There was no communication prior to the renewal. It was a letter sent regular mail.

Permalink Reply by lance on March 13, 2016 at 11:57pm

Hi Bo, we both must have signed the same time with Shell in October 2011. I guess we'll just have to wait and see but I heard that Ascent trying to change the terms of our leases. I only have 22acres

Mike MurphyPermalink Reply by Mike Murphy on March 13, 2016 at 8:07pm

SWN jhas been renewing leases at original terms...waiting on CHK.August renewal

Permalink Reply by Thomas Lilli on March 14, 2016 at 7:26am
Those terms are spelled out in your original lease. you could always have disputed the renewal clause in your original negotiation however, in 2011, I don't know what the market was like for leasing and renewals. I recently signed a top lease that we tried ferociously to strike the renewal clause but the company would not budge. We ended up with a three year extension instead of the second five year extension.

I was represented by very competent legal council and we felt we did the best we could given the current O&G industry climate.
Permalink Reply by william on March 14, 2016 at 10:35am

Just received a letter from Gulfport last week asking me to "amend" my lease with them. They are requesting a deferment of my original signing bonus. Basically paying my renewal bonus out over 5 annual installments.They use this as an example only.Basically states that they could not renew and I could be left out of their drilling plans.

Interestingly my neighbor received his bonus check in December.They have more acreage than I do.

I find it astonishing Gulfport would pay someone $500 more per acre given the price of NG.

I contacted Gulfport to see if they would renegotiate the terms of my lease but they have not responded.

Can't see myself stretching out my bonus unless they give me something in return.

Permalink Reply by Barry D on March 14, 2016 at 11:07am

william,

I do not have a crystal ball, so I can't say for certain why this request is being made.

I could be that the company doesn't want to or can't afford to pay the bonus up front; possibly due to the reduced prices of oil and natural gas. Which makes the request understandable.

What if there is a nefarious reason? What if the company intends to drill just a few wells with large drilling units just to hold property HBP? In that case it would not be worth your agreeing to the request.

I do like your thinking that you should get something for compromising.

Permalink Reply by william on March 14, 2016 at 11:40am

Thanks Barry. I did think about losing the bonus if they drill. I'm looking at many different angles on this. Haven't heard of anyone else receiving these letters.

Permalink Reply by Michael on March 14, 2016 at 11:41am

I made a call to Shale Land Mang this morning and talked to a rep for the renewal of my 200 acres near Raccoon Park Hanover Twp.   I was told that my lease of 5 years was up in June 2016 and the my renewal extension would not be extended .  He also stated that Range may or may not want to redo a new lease since current conditions are so bad. Any one have any advise!  

I sort of feel this is their low ball no faith start, of a long new lease negotiation .   I also know that out in Florence Pa only 3 miles away they built the recycle plant for water drilling. They also have plans for new compressor plant to  feed the new rover Pipeline. With all this info and only 3 miles away and that we are in the so called Rich Area of Ranges that this no renewal of extension lease is their way of low balling a offer in bad times.  Thinking of just saying no and let them pass on any new offer unless of course its better than the old auto renewal.  Anyone else going thru this. 

I also have a right of way with Mark West for them to put a pipe line thru, which I totally sorry I ever signed. This might be the best thing to stop that, without my 200 acres their 660 acre projected well site wont go in and no need for a pipe line going thru me.

Permalink Reply by Donna on March 14, 2016 at 12:43pm

Michael, we are nearby in Robinson Twp., Washington County.  We did not have an automatic renewal clause in our lease, and after it expired, Range said that while they would like to renew, they did not have the money.  But in the meantime they were leasing up everything all around us and doing early renewals on other leases lol. We asked for and received a "Release from Lease" document which we recorded in the courthouse.

Anyway, we also signed a ROW agreement a few years ago with MarkWest but fortunately put an expiration clause in it.  That ROW agreement has expired, and MW wants to renew, but we declined since we have no lease and no reason to allow a pipeline.  Range supposedly plans to drill on the property next to us in late 2017, but they need the pipeline through our land from that well to their new compressor station here in Robinson.  Since we declined to renew with MW, Range has suddenly expressed an interest in signing a new lease with us but offered a lousy contract with only half the bonus we had the first time and far less protections than we had in our previous agreement.  We're not going to sign. 

It's a very personal decision you have to make, but you are not alone.

Permalink Reply by Buckets on March 18, 2016 at 11:15am

The only sure bet that a pipeline will not go in is if the ROW expires.

Permalink Reply by Nancy LeNau on March 18, 2016 at 9:10pm

Brad, Triple Play Landowners Group is Not Still with us, Unfortunately. Todd is having Family issues and his Family needs his time.  God Bless this Man !   His Knowledge is Fantastic ! The Best of Luck to you and God Bless...... Nancy LeNau

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