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Permalink Reply by 0l1a6laz7smpf on March 4, 2012 at 7:05pm

Hi Billy,

don't have time to read line for line per clause right now...  but I do notice some items to point out.

1. Make sure your bonus money agreement is in writing and states that it is directly related to the lease ( the oil companies typically do not want that in the lease as it is recorded...but even then when I saw the paper that explained the bonus money asking for signature from my dad...it did not have any reference to the lease).   So when and if there is renegotiation how is it you can trust the oil company to not just put in the delay rental fee of $5 per year as our contract has?   some say no need to worry..but clearly there is no reference to what the bonus money was for if not stated on the contract lease.

2.   Why only $25.00 per year per acre for a shut-in clause of a 'producing well'?   I think $5.per year per acre was their joke of over 100years on the same contract used over and over again.    Like the 1.00 transfer fee that some do for court records when selling cars, property....but surely not the same thing.

3.   On the royalty no post production costs....why the wellhead?   the post production starts after the wellhead as they take the NG downstream.

Read at this link...cause it talks quite a bit about wording the royalty clause at some of the posts.

http://gomarcellusshale.com/forum/topics/cracker-plant-in-phili-i-m...

also

http://www.oilandgaslawyerblog.com/postproduction-costs/ about wording just what is market value?

 

4.   On the timber clause....would be wise to also include that if they take the timber down they pile it where your timber company can easily pick it up...as maybe they lay it somewhere on the land where no roads or access is easy...so find out from a timber company how they handle such if the oil company just plops it whereever.

There is more to read....I really appreciate your putting this lease on line to discuss...I expect to see a lot of comments.   I have to say after looking at a few older leases from 2008...this is an improvement.

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Permalink Reply by Billy Park Whyde on March 4, 2012 at 7:14pm

Thanks VG if you get the time check it out a bit  as they are now setting a dead line to join the group which I think is very premature for the Licking/ Muskingum County area of Ohio.

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Permalink Reply by 0l1a6laz7smpf on March 4, 2012 at 7:18pm

hey, I just added a link under item 3 about market value in my post above.   

Does the group in Licking/Musk. area of Ohio...are they members of this forum group...they should be.   I think each item on a lease like this needs to be in a discussion individually unless you can keep up with the posts as there is much to cover.   Even if they have a lawyer handling it...it is so beneficial to all of us here at this forum to share for our learning and even for that group you speak of to learn.....not all have discovered well versed oil and gas lawyers (though many are learning quickly).   and so many of us here are still learning about the clauses on our already signed leases ....and many that are still pondering about signing a lease.

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Permalink Reply by Billy Park Whyde on March 6, 2012 at 6:28pm

thanks VG 

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Permalink Reply by Billy Park Whyde on March 6, 2012 at 6:37pm

Under this lease a landowner would be giving everything to the O&G . Some land owners did that with the Clinton drilling boom in the 80s and are now out of luck with higher royalties and lease bonus. Don't we learn?

 As we know with vertical drilling the area that is fracked is no where close to that which can be fracked in horizontal drilling. Say another boom takes place 30 years from now and they want to drill and frack horizontally connecting the dots in the Clinton ? 

  Let them lease only what they want to buy let your kids have some fun 30 years from now.  

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