Anyone having a problem getting a pugh clause from Range or Chesapeake??

Have been negotiating with Range (we are in Beaver/Independence area of PA). We are being told directly by Range that they are no longer allowing Pugh's clause in the lease and we are also hearing through many attorneys that both Chesapeake and Range are saying the same things. We know that a large group in the area have just signed on with Range...have not figured out what terms they received. We were attempting to get $2700/ 16% with Pughs clause but at this point don't know if it is realistic. We have 100+ acres. We are being told by people at Pennstate extension webinars to accept what you can get but then we hear about Utica...anyone, anyone??

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Permalink Reply by Dona Warner on June 5, 2011 at 4:35pm
Hey Terri...I don't know where you live, but our attorney is located in the Pittsburgh area - Ed Voelker of Voelker & Associates.  His office is located just outside the city on Route 8 in Allison Park.  He did a great job for us.  We have recommended him to many people.  He is a real straight shooter and will tell you his costs right up front; he's not cheap but he gives you your money's worth.  I can tell you from personal experience that this guy is honest and knowledgeable.  If you are interested in his contact info, let me know.  Hang in there, it may seem really trying right now, but it's worth the aggravation in the end.  I'm surprised at the difference between the counties' recording of official documents pertaining to properties.   My husband tells me that he believes it may not be mandatory to file the whole document, but in Armstrong County, the OG guys do it.  Good luck! 
Permalink Reply by Joe Fabeetz on June 6, 2011 at 10:06am

Leases are supposed to be filed at the county that the property is in.  Companies file what is commonly referred to as the "short form", containing the minimum information required.  The lease bonus is not required on the short form, so you will see something like "$10 and other valuable consideration".  That way, the company can mask from its competitors and mineral owners what it is actually paying in lease bonuses.  However, it cannot mask the royalty percentage - it must be clearly stated on the short form.

If you want to know what a prevailing lease bonus in the area is, then you will need to ask other mineral owners or those who represent them.   This can be tedious and time consuming but it is the only way to be assured of a dependable answer.  

Nothing in this post is to be construed as legal advice.

0l1a6laz7smpfPermalink Reply by 0l1a6laz7smpf on June 7, 2011 at 10:07am

I hear you Joe about filing the shorter route...but what does that do if there is the situation as I expressed on another post on this page :

(such as leaving a $5. per acre delay rental fee still typed on the contract and not crossing it out and putting the actual bonus fee (also a delay fee) on the contract.

 

Do you mean if the oil company renews or extends the lease they know that the $5.00 per acre delay rental amount is not to be used ...that they will own up to the actual consideration of the original bonus money that was excluded from the contract and not recorded but is on another piece of paper that is not in conjunction to the contract.   This is really poor business dealings in the business tactics....So what is the landowner to do if they use the $5.00 per acre instead?   You see that verbal representation is not reliable for the landowner.   If we had crossed out the amount and put what really was negotiated then the contract is clear...right now it's a 'what can I do' "hope I can trust them to pay up the same or better that was given to dad" situation.

and surely I am not reading your posts as 'legal advice'....just loving having someone to discuss this with!   thanks.

Permalink Reply by A. Betz on June 6, 2011 at 7:02am
thank you Dona for the info...I am also in Pgh area so that helps greatly! I appreciate everyone's input!
Permalink Reply by Moissy on June 7, 2011 at 8:51am

Terri

Another great attorney with extensive O&G experience is John Smith of Smith Butz. www.smithbutzlaw.com   He has helped various townships with updating their oil and gas ordinances for Marcellus shale drilling and has dealt with all of the O&G companies. He has helped us and I have read many others on various forums say they've also had excellent experiences with him and his staff. His office is in Southpointe (Canonsburg, PA).

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