Comment

Comment by Jackie on April 4, 2012 at 9:29am

If a lease is expired they can and usually are still attached to the deed.  I've worked with several people who have found old, expired leases on land they're purchasing.  It really can be a long process, but they've had them expunged from the title.  I refer people to the title company and a local attorney who is experienced in the leases.  Sometimes if there is a lease that is old and hasn't paid royalties, there is the possibility of having it released.  That's not the usual case but a lease attorney can definitely find out.

 

Comment by Michael Kromer on April 4, 2012 at 9:08am

NELA has a no cherry pick rule. I went on my own to make sure that my property is free and clear. I'm confident that Brett and the staff will do their best. Everything that has been predicted by them has happened.

Comment by Susan Johnson on April 4, 2012 at 9:00am

Saying that if there is a lease on the property renders someone ineligible, I am not sure that is entirely accurate.  In many cases, large landowners have old leases that over time, have had the acres held by production reduced to roughly 40 acres around the well which releases the balance of the property available for lease.  You are right , it does take a great deal of research to determine that fact but it is well worth it to determine for both the flipper who wants to provide as many acres to a driller as possible and for the landowner to know exactly how much they can lease and how much they can't.  is this a NELA rule - you are not eligible if you have current leases or are they saying anyone with an old lease they believe is always held by production for their entire property?

Comment by Susan Johnson on April 4, 2012 at 8:45am

On NELA leases - does everyone in the group get the bonus or does the driller get to cherry pick what they want. For example, if the NELA group has collected 20,000 acres does every landowner get accepted and paid?  If some have title issues do they get dropped and the driller can keep the good ones?

Comment by Depolarized Farmer on April 4, 2012 at 7:25am

Jackie, according to my conversation with NELA's own leasing guy (Chris), NELA does not guarantee any payment to the landowner if they can't flip the lease.  Please don't mislead landowners on this very important point.

And yes, the landowner is indemnified in the ALOV lease.

Comment by Depolarized Farmer on April 4, 2012 at 5:03am

Jackie, I don't think it is accurate to say that NELA is "guaranteeing" at least $2,000 per acre.  That applies only if they can find a buyer to flip their leases to.  If NELA can't find a buyer (because the O&G companies don't like the lease language, because NELA's acreage is too scattered, because desirable acreage is mixed with undesirable acreage, due to title issues, or due to any other reason), isn't the landowner stuck with a worthless 5-year lease obligation and empty pockets?

By the way, the water clause in ALOV's Trumbull lease is the best I've ever read... even stronger than the language they had in their earlier leases.  It is very specific about preserving water quality and quantity.  Aren't those landowners far better off having BP's deep pockets contractually obligated to protect their water versus having someone like NELA?  Where does NELA get the financial resources to cover all of the liability they are supposedly assuming for all of their landowners?

Comment by Adam Thomas on April 3, 2012 at 2:10pm

Hunter4440- what you heard is correct.

Comment by hunter4440 on April 3, 2012 at 10:30am

I was recently told that some landowners began receiving checks from Wishguard. Can anyone out there confirm that. thanks..

Comment by Dan on April 3, 2012 at 10:24am

I went to one of their meetings and I thought the min was $2000 per acre and that they would be flipping the lease to a driller. The down side for me was the 5 year commitment and no firm date  when that might happen.

They tend to work the fear on water quality. They have the water quality guarantee, that ,  I have doubts about. 

 

Comment by Depolarized Farmer on April 3, 2012 at 9:10am

Please correct me if I'm wrong, but I seem to recall that NELA's lease doesn't require them to pay a bonus payment to the landowner unless and until they flip their leases.  But those landowners are irrevocably committed for a 5 year term and can't back out.  Jackie, is that correct?

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