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?

 

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Permalink Reply by Buckets on March 25, 2016 at 5:15am

As everyone else has commented, I wouldn't let them pressure you into signing anything until you've had time to do some research and find a reputable oil and gas attorney who has experience with W.V. As for their not being able to change anything because the well is in production?  That's not true.  Otherwise they wouldn't be able to ask for an amendment in the first place.  Here in Ohio it has become standard practice for oil and gas companies seeking amendments to include some up front compensation for signing the doc.  It won't be an extravagant amount but it's something.  They have also been forced to include amendments that provide protections the original, outdated leases didn't include.  You can ask for more royalty but that will probably be something they refuse to budge on.   

Sounds like this is a brokerage company. Sometimes the contract landman contacting you may not know the details of how much money is in escrow, etc., maybe their job is to just track you down.  However, that doesn't mean there's not a project manager who speaks directly with Ascent.  They should be able to provide details on how much is in escrow, what royalties are and any other answers you need.

If the interest were for just 1/16th of .14 acres then I'd say just sign the amendment and move on but 4+ acres is a different story.  Probably won't become a millionaire but could make a decent amount of money off of fracking production.  

Be sure to contact the rest of the family involved and discuss with them.  Best to move forward together if at all possible. 

I'm not familiar with WV laws on forced pooling but I doubt they will go that route until prices bounce back which gives you some time to sort this all out.

Permalink Reply by Mark Hrutkay on March 25, 2016 at 5:17am

I'm a retired lawyer in WV....  NO LEGAL ADVICE HERE.....

What you have is 4 acres...

The past due royalties may add up to something significant.  As far as taxes on them go, talk to a CPA...  I'm guessing you may well have to pay 3 years of taxes.....  The other 7 years, the SOL on filing has probably expired...

Everyone says HIRE A LAWYER...  Let me clue you all in ... Lawyers don't work for free, its going to cost you something (probably a couple $1000 at a minimum)    You have 4 acres and there is a LEASE ON IT NOW.... There is nothing to negotiate.... PERIOD....  The gas company is simply trying to give you your money before they turn it over to the state treasurer as unclaimed property...

You MAY want a lawyer to check the gas company's work on the intestate succession to see if everyone got "their fair share" and the estate was divided up properly.   Assuming you know other relatives, you should all go as a group and SPLIT the attorney fees...

I can say from my dealings with gas companies the majority of their work in this area (dividing the pie up) is  correct, since they do it everyday.  They also tend to be very cautious to ensure that they don't get sued...

My simplest thoughts are to take the money and run.  If  you want to share it with a lawyer thats fine..  Use caution selecting one, since like personal injury, MANY who are not qualified or poorly qualified hold themselves out to be experts....

Good luck


Mark

Permalink Reply by Buckets on March 25, 2016 at 5:33am

You're correct about just taking the money and run in the case of money being in escrow.  But signing an amendment is a whole other issue.  Getting a decent attorney involved in that respect might be a good idea.  Since it sounds like none of them own the surface, the negotiations would probably revolve around amendments, a depth clause and possible up front compensation.  Splitting the attorney fees amongst the family is a great idea.

Permalink Reply by G.H. on March 25, 2016 at 7:59pm

I agree that a lawyer can be a waste of money.  But if you REALLY don't know what the documents are saying, or major issues that could arise based off of the documents, then it is probably a good idea to hire one if the acreage concerned is large enough.  Really depends on how much you are going to make off of your interest, and/or how much of that you are willing to spend up front to get it right if you lack the confidence or ability to take care of it yourself.

You definitely need to take into consideration that there is already a lease on the property, and that negotiating any amendment will likely be much more minimal than negotiating the original lease.

Permalink Reply by Herb Miller on March 25, 2016 at 5:37am

If you get to the point where you want to talk to an attorney in Wetzel County, I would recommend Logan Hassig of Snyder & Hassig. He has been helping people with leases since the fracking boom started (including myself) and he, himself is a mineral owner. Their number is (304) 455-2180.

Permalink Reply by Kyle Nuttall on March 25, 2016 at 5:53am

Ascent will negotiate some things with you.  They will give you Indemnification and a No Warranty of Title clause.  I have no idea why they said they wouldn't.  Ascent asks for more than just pooling in their lease amendment if I recall correctly, so it makes sense that you could ask for some amendments to the old lease yourself.  They will also pay you some money to sign.  There's a lot to learn.  There's been a lot of good advice given already.  Best of luck and have fun!

Permalink Reply by searcherone on March 25, 2016 at 1:36pm

Just some observations.   In WV severed mineral interests and dying without heirs makes a detailed  search necessary and I have closely observed  that the oil and gas companies have done an  excellent job of tracking down the cousins.   lol they know who your wife's relatives are better than she does and they use documentation  to prove it. . .birth and death records, obituaries, census records and on and on.

Look at the genealogy charts carefully which will give you an idea of how many  people are involved. 

For example does your wife have siblings, they  will get a share,   one of the  siblings died and left ten children those children will each get a tenth of their parents share.

Bottom line on four acres your wife's share may be small.   Don't be surprised if your wife is asked for her personal identifying documents.    Time to know who the relatives are.

Permalink Reply by Nancy Mosley on March 25, 2016 at 1:52pm

You should post in the Wetzel county group.

Wetzel county WV group

Under that group is a discussion that involves a place to search the old and new records of Wetzel county Discussion on Wetzel County records

especially the one by NY Shale Gas Now on March 27, 2015 at 12:55pm

You can look in the modern records and see if there are documents under the names of any of the relatives, and also search the company's name to see what kind of things you see from them.

You might find affidavits of heirship on some of these people. Some of that (if it is there) might give you some information on how to determine about how much of a share your wife has.

If you know the ancestor who signed the lease in 1896, you can search that name (sort of tricky til you get used to it) in the index of the old system. This can get really interesting in a family history way, and might give insight into the oil and gas interests.

You might start a discussion in the Wetzel group with  a  link to this discussion.

Permalink Reply by Jason L on March 25, 2016 at 1:53pm

Thanks Nancy, I will definitely check this out.

Permalink Reply by Jason L on March 25, 2016 at 1:51pm

Thanks everyone for the advice so far.  I've managed to look through the 1896 lease and think her interest may be smaller, but not sure what's going on yet.  Still waiting to hear what's in escrow/suspension, if anything.  I am not sure that the genealogy that was given to me was just one part of the overall picture, and based on the original contract, there are probably other lineages that inherited something as well.

It is unusual, I assume, how this came about.  The last owner of the oil & gas rights was a relative of the original owners.  He passed away and his interests went to his spouse.  His spouse passed away without any children, and both parents were deceased.  So her rights went to her aunts and uncles, who were ALSO deceased, so it followed their descendants.  My wife is a great granddaughter of one of the aunts (my wife's Mom passed away a few years ago, otherwise it would have gone to her)  

Even if there's little money, this has been a very interesting experience...

 

Permalink Reply by Nancy Mosley on March 25, 2016 at 1:54pm

I put my reply in before I saw your post, so it would not be your wife's family history but would be her relative's inlaws. Still interesting.

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