This may seem like a stupid question , here it goes
If I lease 2 acres in Ohio and is in a drilling unit, my question is, if they drill and strike oil or gas,will I get my royality even thou they do not actually drill thru my property?? Thanks
On my neighbors pad Chesapeake claimed that they will go northwest , I think 1800 ft before they reached the Utica so it would be easy to see where a land supporting a well pad may not receive royalties but I believe the landowner would.. I just looked at the unit papers and all his acres in the unit start right at the wellpad even though they wont reach the depth they need until they go north several hundred feet. Hope that helps
Scary to think you could have your land tied up with an ugly drill pad on it forever and not receive $1 of royalty for the millions of dollars being taken out other than the $15k upfront payment for placing a pad on one's land while your neighbors are all receiving long term monthly royalties based on having a drill pad on your land and not being able to use that land in one's lifetime...something's just not right here.
Sounds like a word of advice to all those considering having a drill pad on their land to get it in writing from the OG company that your land will be included in a drilling unit(s) otherwise tell them go put their pad somewhere else....$15K (then deduct taxes) isn't worth the aggravation, noise, truck traffic and scaring of one's land if there is no guarantee of long term reward and reimbursement for one's efforts to help the OG company get rich....not to mention the legal liability....the same people who tell you that you won't get sued if something goes wrong...yeah right.
Except as provided in section 1509.021 of the Revised Code, the surface location of a new well that will be drilled using directional drilling may be located on a parcel of land that is not in the drilling unit of the well.
Added by 129th General AssemblyFile No.28,HB 153, §101.01, eff. 9/29/2011.
The law above allows a G & O Co. to put the rig on your land and not include you in the drilling unit. Be careful what you sign.
Thanks Kathleen for the explanation...it's still not clear to me how a drilling unit is defined or what factors are considered when defining a drilling unit...is there some rules/ guidelines (issued by ODNR?) by which O & G co. need to abide when defining a drilling unit?
I'd presume that the primary driver in defining a drilling unit would be the location of the well bore head(s) and plot plan that they have to submit to the ODNR. Furthermore the final drilling unit would only be defined by the direction and length of the horizontals that are actually drilled....since a plot plan would only represent the "intent" but may not reflect what actually and finally got drilled e.g.the length of the horizontals. Does this make sense???
I've heard some folks only learn from the O & G co that their land is in a drilling until AFTER they're done drilling??? Which kind of makes sense. Again I presume that this would be defined by the final lay out, direction and length of the horizontals.
What I can't understand is how one could not be included in a drilling unit even with a drill pad on your land. This would imply that a drill pad itself is NEVER part of or included in a drilling unit...is that true?
It seems that in a situation where the landowner's parcel is rather small (<20 acres) and who has a drill pad placed on this small parcel might not be included in a drilling unit. If on the other hand he owns a much larger parcel (> 20 acres) and the drill pad takes up say...only 10 acres of the total 20 acres then it would stand to reason in this scenario that the remaining 10 acres could be included in the drilling unit....again does this make sense????
$16,000. is WAAAAY too low.for a drilling pad. If you can negotiate, get at least $25,000. and make sure you are included in the production unit. IN WRITING!