Wife has inherited rights where lease is in place...lost about what to do.

My wife received a letter in the mail from Global Land Partners explaining how she has inherited rights in Wetzel County WV, including a genealogy chart that shows other family members who also inherited the rights.

In short, her great-aunt passed away more than 10 years ago without any children or living parents, so the rights were passed to her aunts and uncles, one of which was my wife's great grandmother.  This is all out of the blue to us.

They also included a lease amendment that they want to sign to create a lease pool.  When I called to ask about it, he explained this was for fracking, and he said there was already money in escrow, and they just want to get that out to us.  He would not tell me what was in escrow, nor would he give me any other details.  The gas company is Ascent Resources. 

I specifically asked for an Indemnification and No Warranty of Title and he said the oil company "wouldn't agree to changes since its already leased and producing."

At this point, I have no idea what type of interest my wife has, what's happened to royalties since production began (the person she inherited the rights from died more than 15 years ago).  Where do I go from here?

 

Views: 2159

▶ Reply to This

Replies to This Discussion

Permalink Reply by bo boboski on March 23, 2016 at 12:22pm

An Attorney's office?

Permalink Reply by Jason L on March 23, 2016 at 12:29pm

I'm hoping to get a better handle whether its worth it or not.  I mean if there's $5 in escrow, why bother, right?  Is there any easy way to figure this out? 

If I were to go to an attorney, can anyone recommend someone who knows West Virginia law, specifically in Wetzel County?

Permalink Reply by paleface on March 23, 2016 at 12:33pm

Enjoy it,new found money. 

Permalink Reply by Jefferson on March 23, 2016 at 1:24pm

This actually kinda happened to someone I worked with (but he has since passed away).  His situation was in the leasing stage though - all remaining family members had to sign lease though.  I would suggest getting together with other family members siblings/cousins as they should all get the letter also.  You will then need to see a lawyer as whatever is signed is divided by all remaining relatives.  Proceed with caution and don't sign anything til a lawyer sees it as this is a somewhat unique situation.

Permalink Reply by G.H. on March 23, 2016 at 2:03pm

You should be able to get them to tell you your net acreage in the parcel and/or unit.  They may have already provided it in what they sent to you.  That should tell you if it's worth your time and money.  You could have a 1/2 interest in 1 acre, or a 1/2 interest in 1000 acres, or a 1/200 interest in 1 acre, or a 1/200 interest in 1000 acres, etc. you get my point.  Your net acreage is what you need to find out.

Permalink Reply by Barry D on March 23, 2016 at 2:39pm

Jason,

G.H. is correct, the company knows the interest your wife owns. They may say they don't but they do. Stand firm and demand to know.

Jefferson brings up a good point; your wife may be entitled to a portion of the acreage bonus money.

Plus, the people you spoke with are wrong, the company will change certain things for you such as no Warranty of Title (my opinion).

You should also be contacting as many people in that genealogy chain they sent you.

There are so many moving parts here, you really need to consult an attorney.

Permalink Reply by Barry D on March 23, 2016 at 2:31pm

Jason,

Tread slowly. No matter what the oil and gas company says there is no reason to rush.

I just helped a friend through a similar situation, attempting to complete a title search on a property. ( I am not an attorney). He is trying to determine the correct fractional interest that his family owns in a piece of property, verses what the oil and gas company claims.

I do not know your situation in detail so my comments are in general.

Many times oil and gas companies will try to run rough shod over people such as your wife in order to clear up issues with fractional interests. Not saying this company is. but could be. So take your time, and yes it may be worth investing in an attorney ( perhaps one would look at your situation initially for free and work on a contingency from there. So you won't have much out of pocket expense.

At the very least I would want to see the title work performed by the company, you may not be familiar with this type of information but a competent oil and gas attorney would.

Do you live in or near Wetzel County? Does your wife own a surface interest and an oil and gas interest? Or does she only own interest in the oil and gas? Perhaps she only owns a royalty interest?

As far as what has happened to the royalties - when companies have difficulty finding the owners of fractional interests they drill anyway (sometimes). They escrow the royalty for those interests.

I think it's worth your time to meet with a competent oil and gas attorney.

Permalink Reply by Jason L on March 23, 2016 at 3:24pm

Thank you Barry.  We do not live near Wetzel County, nor do we own any other property there.  My wife apparently owns a fraction of the rights from a 200 acre farm that was leased in 1896(!) I did manage to get a copy of that lease from them.  If I do my math correctly from the genealogy that they supplied, my wife's fraction is about 4.17 acres.

It looks like I need to find an attorney that knows Wetzel County.

Permalink Reply by Barry D on March 23, 2016 at 3:51pm

Jason,

I just helped a friend in a similar situation.

We are both familiar with oil and gas title searches, but in the end he relied on an oil and gas attorney, we just performed the leg work.

I sent you a friend request, I may be able to help you, but I need to ask a couple of questions. It's up to you.

Permalink Reply by G.H. on March 24, 2016 at 9:54am

I don't know what production is like in your area, but 4.17 acres seems like enough to hire an attorney to get it right.  

They almost certainly want an amendment to change the maximum pool size.  At least that is what is common if the lease is older.  I am not positive on this, but I don't think you'd have to worry about the warranty of title because you weren't the one who signed the original lease.  Unless, of course, the amendment includes a clause where you warrant the title when you sign it.  A good question for an attorney.

The main point, I guess, is that you don't HAVE to sign anything.  But if you don't, then they can't drill.  And if they can't drill, then you don't get any money, or they could probably force pool you, I'm not familiar with WV.  So basically, try to get it changed to something reasonable that you are comfortable with, then sign it.

Also, there is a good chance (probably 99%) that whoever contacted you is just a contractor working for the producer, and is not privy to the amount of money they have in escrow for you.

Permalink Reply by Jim Litwinowicz on March 23, 2016 at 3:49pm

You will need an attorney, I am not one.  But if it were me, I would try to contact those aunts and uncles or any other heirs mentioned. Use that genealogy chart to work with.  Talk to them as they probably got same letter.  Maybe they know more about the rights, especially if one of them still lives near where the great aunt did.The more you know before seeing an attorney, the better off you will be.

Look at the great aunt, go to the county website to see if she owned land or rights that were recorded on a deed. Or call someone at the court house to see if they can help. Did letter have any deed or parcel numbers or other data that would help?

If you find the parcel, you may be able to get a copy of original lease.  Aunts and uncles may also have a copy. If you get it, and your portion is large enough to make it worthwhile, have an attorney look it over.  And not one that did oil and gas 20 years ago but one familiar with horizontal fracking and the new issues it brings to the table. Find out if you also own surface rights as that will change a lot of concerns.

The company says that they want you to sign an amendment 'to create a lease pool.  They are probably trying to change unit size as old leases often had limits of 180 acres or less and they need bigger units for fracking.  That gives you the opportunity to negotiate for what you want....indemnification, title issues, anything you want.  But you won't get everything, or even very much for that matter, so prioritize your needs/desires. 

See if anyone else signed any amendments yet. If not, try working together to gain some leverage with the company. The more acreage in your pool the more leverage you will have. You may have a lot and may have very little...very hard to predict.

I am not familiar with how mineral rights are escrow-ed in WV. If it listed with the state, that may be a good place to look up your ownership percentage/acreage.

Good luck and give us a progress report as this will be good info for some people that find themselves in similar situations.

Permalink Reply by bo boboski on March 24, 2016 at 2:05pm

If your wife inherited leased mineral rights,Has she thought about the tax on the royalties. Does she have to pay tax on inherited royalty payments?

RSS

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

Badges  |  Report an Issue  |  Terms of Service