Silly Question

My ex and I were discussing the fact that the landman also acted as the notary. I say that it is a conflict of interest since the landman benefits (either through commission or direct salary) by getting me to sign a lease....it's his job to get me to sign. My ex doesn't see that as a conflict of interest at all. What do you all think? Not important, but the kind of thing that comes up on a rainy day.

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Replies to This Discussion

Permalink Reply by Lynn Wigglesworth on August 31, 2011 at 11:49am
I would not have signed that, either. And I didn't, but now I've got it. Feeling tricked and cheated by the landman. Still waiting to hear what Shell has to say.
Permalink Reply by paleface on August 31, 2011 at 1:51pm
 I read the addendum to read no surface desturbance witout written consent from the lessor?You have no deductions and no surface if they give you anymore it will become a joint venture not a lease?
Permalink Reply by Lynn Wigglesworth on August 31, 2011 at 2:31pm

It doesn't say anything about no surface disturbance. It says "no further surface operations concerning drilling of an oil and/or gas well". It doesn't specify what is "concerning drilling of an oil and/or gas well" and what isn't. It could allow tanks, roads, pipelines, compression stations, and a lot of other things not directly concerned with "drilling of an oil and/or gas well".  That's not a true non-surface lease.

I don't understand the part about a 'joint venture'? People have gotten 20% royalties and far better leases and it's still a lease.

Permalink Reply by Brian V. on August 31, 2011 at 2:37pm
He meant the next best thing would be a joint venture or in other words you would be a partner with them and not simply the lessee.
Permalink Reply by Lynn Wigglesworth on August 31, 2011 at 2:45pm
I wasn't offered the opportunity to be a partner, and I don't want to be anyway. I just want the lease that I was offered and that I signed. The lease I signed isn't even that good; last summer Chesapeake came through offering $3000/18%. One of my neighbors got that deal, but by the time my lawyer got done diddling around (3 weeks it took him to look at the lease), they had withdrawn the offer.
Permalink Reply by paleface on August 31, 2011 at 2:56pm
 That 18% has deductions and you could have a well on your property?
Permalink Reply by Lynn Wigglesworth on September 1, 2011 at 12:58am
I'm sure the 15% 'no deduction' that Shell offers has loopholes that allow some deductions anyway. The Chesapeake lease WOULD allow a well, but the chances of anyone wanting to put a well on my property are pretty remote. It's situated so that part of it is already in a Shell unit (nowhere to put a horizontal; it's surrounded by Shell land), and the rest is too close to buildings for a well. It's not a well that I worry about; it's all the other things (see above) that the Shell lease allows. If I wanted a regular lease, I would have gotten addenda that disallowed many of those things.
Permalink Reply by N Bohl on September 1, 2011 at 2:41am

It sounds OK to me except now you are limited to what you can ask the seismic team to be careful of. Hopefully you can still talk with them beforehand in regards to your cattle and farm etc.. It would cost $100 an hour but it may be worth the money to run this all by someone like Greg Gass - in our experience he is very good with his time and at the very least he could advise you simply and maybe tell you first how much it might cost. When we went through leasing I was bending over backwards to see every angle in the wording. I went a little over the top - which I think is OK. Where it says "concerning" I would think that covers any connection at all to OG development including roads and pipelines because that "concerns" a well.

Permalink Reply by Lynn Wigglesworth on September 1, 2011 at 2:53am

I'd be happier if they would have left it at "no surface operation". It may be changed back. I heard from my contact at Shell and she's going to 'fix it', although it's not clear exactly what she is going to do.

 Isn't anyone but me concerned that someone altered a contract after it was signed without the consent of all the parties to the contract? Isn't that contract fraud and against the law? If they changed mine, they could have changed other people's too.

Permalink Reply by Brian V. on September 1, 2011 at 3:48am
Did they alter it and not have you sign it (the change to the addendum) or (dumb question) not tell you it was altered? Really until the memo is recorded and even after changes can be made, they have to be agreed to by both parties. If you did not sign the new addendum they can not claim you agreed to the new term. SOmeone mentioned earlier about initialing the corners of ewach page of the document. It is not common practice with leases but it certainly can be done.
Permalink Reply by Lynn Wigglesworth on September 1, 2011 at 4:02am

They altered it AFTER we signed, and no I didn't sign the new addendum. I didn't know anything about it until the landman brought me a copy two days later after (I think) he submitted the changed Addendum with my lease to Shell.

I was told by my contact at Shell that "It seems that nobody signs the addendum however, on the lease – at the end – there is a notation that an addendum exists." Yes, an addendum exists...he submitted the one he changed. My ex (who also signed the lease) said that he's sure we initialed the original addendum. Where that addendum is, who knows? Paper shredder?

 

Permalink Reply by Brian V. on September 1, 2011 at 4:22am

Lynn, to the right of your screen there is a section called "Trending on GMS" The top thread named "How can this be legal" has a very interesting discusion going on about recording and other issues with the signing and recording process. It's worth a read.

 

It seems whoever you are working with within Shell itself is a reasonable human being. Ask to have a signed copy mailed to you and also notification of when it is recorded.

 

I am sure by now your lease is out of the landmans hands and being reviewed (to verify all the signatures and correct property info ect.) It would seem resonable to ask that you may be allowed to initial each page for peace of mind. Someone on the other thread even brought up that you may be able to record the entire lease yourself. However, I'm not to sure about that. The copy you have has nothing other than your acknowledgement of this agreement, and you would also need to piggie back it off of the memo that SWEPI eventually records.

 

I have not had much experience with Shell or Long Consulting but I'd imagine if you nag them enough they will do anything just to wrap this up and have one less issue to deal with.

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