Looking for a Lease Release Demand Letter

Hi All

We have several companies who are paying us on a yearly basis for maybe 50 BBL's of Oil in what I consider an attempt to HBP us. I want to send them letters stating that their payments/production do not justify HBP status and we want a release of the lease. I think this is the correct way to proceed in this matter. If not, maybe someone has a better suggestion. We have no idea what deeds they may be using to lease, thus don't know the terms of the lease. Some are probably 50 years or older. This also might provide us with a copy of these leases. In any event, does anyone have a copy of a Release Demand they could share with me. We have an excellent lawyer, but don't want to pay his fee's until it comes to a stand still. Before I hear you scream on that one, understand that we are all lawyers and could probably muddle our way through this if need be.

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Permalink Reply by Tom R on August 2, 2013 at 2:03am

You might want to check this out, its a thread in the Tioga County PA group. Not sure if it covers your exact situation but it does have a Release Demand document attached with the initial post.

http://gomarcellusshale.com/forum/topics/if-your-lease-expired-then...

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Permalink Reply by Jim White on August 6, 2013 at 12:20pm

Thanks Tom. Not quite what we are looking for, but I can use some of the language and draft my own.

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Permalink Reply by wyalusing jim on August 6, 2013 at 1:41pm

how about:

"you aint producin' near 'nuff oil to even pay my taxes, so I want out o' that there lease we got!"

seriously, their payments may well satisfy the terms of your lease. ya gotta read it to see if it does.

if it does, my next question would be, are they actually producing? or just sending out checks for peanuts to hold leases? in most cases there has to be actual production.

and then the next question would be, is this well(s) economic. in other words does it produce and pay over and above the cost of operating it?

getting out of a lease can be tricky. ya gotta get your ducks in a row.

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Permalink Reply by william r rinehart on August 7, 2013 at 5:08am

Well,

There is know way they will release you unless you take them to court, plain and simple.

There is a shallow well holding 246 acres HPB, for just $48.00 a year, paid to the original owners. They sir are sitting on a gold mine and they know it. Remeber the driller fills out the form for production, not audited by anyone. "lets see how much I need to write in".

Its one of the biggest frauds in Ohio.

Bill

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Permalink Reply by Nancy Mosley on August 7, 2013 at 5:42am

Probably also in West Virginia. You need to know the meter number for the well and the name of the pipeline company who buys the gas, or gets it from the well, and then have an attorney writr a letter on your (royalty owner) behalf to get the info from them about what they collected from the well. Not easy to do unless ypu are also surface owner and can go on the property and look.

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Permalink Reply by 0i7okn54zwbdo on August 7, 2013 at 6:06am

50 bbls/oil is probably enough to HBP the land. Is your expectation that the company is simply going to release you from the lease, plug the well at their expense and walk away from deep rights because the production does not meet your (fairly arbitrary) standards? That sounds like a stretch to me. You'll need more evidence than just your desire to be released. Look into past judgements that deal with the reasonable threshold of what constitutes HBP status and see what the precedent is.

Further, what does your lease state? What is the wording in the term clause that delineates how long the lease can be held and what the definition of production is?

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Permalink Reply by Jim White on August 11, 2013 at 5:37am