Trading leases

I am new to this leasing game so I was wondering if a landowners association leases thousands of acres of land and they are spread out all over, do oil companies trade leases with other oil companies so that they can consolidate their leases in a more continuous block of land? Otherwise they would have some isolated parcels that are not big enough to drill on. What do you think?

Views: 286

▶ Reply to This

Replies to This Discussion

Permalink Reply by Steven A Joliat on November 13, 2011 at 8:32am

Reselling or other means of exchanging lease acreage is a common practice in the industry.  If the lease is resold or assigned to another company, most leases contain a clause requiring the lessee to inform the lessor of the change in ownership.  Other types of trading acreage may not require notice to the landowner as when the current lessee offers an interest in the lease or proposed well to another company or group of investors in exchange for money, a rig, or another lease in another location.  This is mostly done to spread the risk among multiple parties, but it is also common when a single lease may not have enough land to allow for efficient development of the oil and gas resources.

RSS

© 2024   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service