Replies to This Discussion

Permalink Reply by Bob Shaw on March 14, 2016 at 11:04pm

First of all, I suggest contacting an attorney that works in Oil&Gas. My guess is that you are in a strong position to get more favorable terms, depending upon how many acres you have, and the total size of the Unit. Generally, in Ohio, the Driller must have obtained 90% of the Unit before Mandatory Pooling goes into effect. (there are exceptions to that). 

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Permalink Reply by Mike Murphy on March 15, 2016 at 1:53am

several factors need to be known  how many acres  what was the original royalty and bonus where is the lease located what is the  one year extention lease bonus offered ??sounds e they need you get an ATTORNEY

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Permalink Reply by BIG on March 15, 2016 at 3:23am

They O&G company has until 2017 to produce out of the well. They could complete the one well that goes under your land. They do not need to complete all the wells unless there are more leases that will expire in 2017. If so, they will complete all the wells. If you don't sign the extension they will produce the well and you will be subject to the low prices of commodities. You could sign an extension and gets some bonus money upfront and the company can hold off completing the well until prices come up.

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Permalink Reply by Tim Anderson on March 16, 2016 at 3:15am

I understand this thinking, and that is what the gas company has suggested they would do, but it seems to me that it would cost them so much more to do it that way then it would cost them to slightly increase my royalty.  The cost to them of producing from this site has to be large, and the lost revenue from doing it with prices so low seems like it would be cutting off its nose to spite its face.  They've also suggested that they would redrill the well and go around my property.  I can't imagine that that would be a better option to them.

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Permalink Reply by Barry D on March 15, 2016 at 3:50am

Tim,

I am not sure about several of the issues you have raised. As suggested in another reply, consulting an O&G attorney may be wise.

As for selling the gas (or other produced products) - that would be theft if you were not compensated (my opinion). But again, an attorney could answer this question far better than any of us here is able.

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Permalink Reply by Tim Anderson on March 16, 2016 at 3:11am

I agree with your theft point.  Thanks for your reply.

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Permalink Reply by Tim Anderson on March 16, 2016 at 3:16am

Thank you all for your feedback.  I will get an attorney.

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Permalink Reply by James T Monyak on March 18, 2016 at 6:58am

You are in great position since that can't drill a well under your property. Depending on how much land you own in the drilling company unit, they could force you into the unit under the old terms.  Saying that, nothing gain nothing lost.

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Permalink Reply by Marcus Brown on March 18, 2016 at 12:40pm

Offer to sign a new lease for a 3 year term and renegotiate the lease.

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