Finality of lease

I implore every land owner to make decisions with consideration of every aspect of the lease language.  It is not a good practice to sign anything that we do not completely understand, no matter what the sign-on bonus is. The bonus $$$ is the big worm on the hook. Lets continue to stand shoulder to shoulder and make sure that we get a good lease. The lease that we sign today will affect our family and neighbors for many years after the bonus $$$ is gone.

Views: 1140

▶ Reply to This

Replies to This Discussion

Permalink Reply by Angie on September 15, 2011 at 4:40am
Be very careful in what you sign! We signed 5 years ago and were looking forward to renegotiating a new, more favorable lease at expiration. What we found was we are not able to get a new lease. CHK owns the leases around us and no other company will give us an offer. (trust me, we tried and tried) CHK gave us a top lease offer, basically just extending our current lease for 2 years and would NOT even consider any changes to our original terms. We were told either to take the top lease offer, or be left out of the unit.  The position of which would make it seemingly impossible for another company to utilize our property. Reps from other companies confirmed this and said trying to lease in the future would be nearly impossible. Even with over 80 acres. After consulting with a lawyer....we found they can get away with it.  VERY poor business practice and should be illegal!  And the commercials saying how landowner friendly they are....laughable.  They actually said this is a "win-win deal". For them yes! On another note, for those with newer leases... Have even heard tales of them going back to landowners who had negotiated good lease terms in their leases with  proposed ammendments to Remove those very terms. Telling the landowner to either agree to it or be left out of the unit.  So be prepared in case you see that scenario. It is a shame. They are going to make billions off this play. The landowners should not be taken advantage of in the process. Everyone says hire an attorney, But it wont do any good if the company comes back later demanding to remove all favorable addendums from the original lease!  Maybe we were one of the fools in signing years ago....but I think everyone is being short-changed in the long run. Best of luck to anyone able to get new leases, and for sure get an experienced attorney to make sure they cant come back and try to change your lease in the future!
Permalink Reply by Jim Litwinowicz on September 15, 2011 at 7:35am

Talk to everyone around you and see if their leases are about expire including if it is a year or two away.  If so, work as a group and be strong. If you can get a lot of neighbors to tell them they won't renew, it may make them more co-operative. Have the same group hold strong about changing existing leases.

 

Good luck!

Permalink Reply by Jeff on September 15, 2011 at 4:39pm

Angie,

Do you think that it would have helped in your situation if you were part of a group or would that not have mattered?

Jeff

Permalink Reply by Angie on September 16, 2011 at 1:17am
At this time, there was no one to form a group with in our immediate area. Most of the neighboring properties formed a group 2 years ago and signed. We were the only property due to expire. That is why we were in the position we were...they had us up against a wall. If there had been other properties ready to expire in the area and we had formed a group, Im sure it would have helped.  We had an attorney working with us, and as much as he tried, we could not get them to negotiate any terms with us.
Permalink Reply by Leann K Appel on September 15, 2011 at 6:21am

We only have 10 acres and have not signed a lease. We need to decide but do not live on our property. We have leased it to an individual who wants to sign but he does not have the right to  do this. we may have sat on the fence too long. Are they still doing leases?

Leann

Permalink Reply by Jeff on September 15, 2011 at 4:33pm

Leann,

Yes, The groups are still forming. What County is your property in?

Jeff

Permalink Reply by Leann K Appel on September 16, 2011 at 6:02am

tuscarwas, it is the line for Tusc and carroll but we pay taxes in Tusc.

Leann

 

Permalink Reply by Jeff on September 17, 2011 at 4:06am

Leann,
I am not an expert at all, but my personal opinion is that you should still have some opportunities available to you. Don't give up, It appears that each landowner may need to get himself or herself involved.   

Jeff

Permalink Reply by Sarah Violet on September 17, 2011 at 4:36pm

Angie, we may be in different Counties and have different Gas Companies. But you and I and many others are in the same boat. I suspect in the next 6 months to a year we will be hearing a lot more of these types of stories. Our stories are almost the same. What some of these gas companies are doing reminds me of the car salesmen who sell you a lemon, then laugh all the way to the bank. (The Lemon Law ) In my case I received a letter in the mail stating they wanted to extend the lease, offered bonus $s and an increase in the royalties. I tried to contact them and all I got was the run around, someone will call you, but know one ever did. They were/are trying to run the clock out on me. So why did they send me that letter in the first place ? I have a very,very short length of time left before my lease expires. It looks very doubtful that I will be able to get a new lease. I do hope your old lease is better than mine. The attorney has told me I have a very bad lease, no protection at all, they can do just about anything they want on and under the surface if they want to. It really bothers me when people say "You signed the lease you should have known better." Just because you have an old lease doesn't mean you are the one who signed it. I have another piece of property which is currently not under lease. I know who I will NOT be signing a lease with on this property.

 

Permalink Reply by Angie on September 20, 2011 at 8:58am

Sarah,

I would contact other Gas companies before you expire. Find out if the company holding your lease has any proposed wells that would involve your property. If they dont, you may be able to get an offer. For us, the other companies said they would have made us an offer if there wasnt already a proposed well. (and the well has not been permitted or anything yet) But they wouldnt "step on CHK's toes" by trying to lease a property that would eventually be involved in their unit. So if no well has been proposed in your situation, then you may have options. 

We had a lawyer helping us and he was able to educate us. We were very happy with him, even though he wasnt able to get the Gas companies to negotiate any terms. We were willing to take much less on bonus $ if our royalty was raised to a fair amount. (not even the going rate...just middle of the road) and they wouldnt even consider it. They got our lease cheap and wouldnt even give up a simple 2 1/2% on royalties to make our rate 15%. Ridiculous. It certainly wasnt because the lawyer didnt try, but because CHK is greedy. We have a "boiler plate" lease too, and we are not alone. Some of the largest landowners in the state signed the same. (I know one personally and he hasnt been able to get out of the leases either.

I hope you have a better chance to get another company to give you an offer. You should consult an attorney and shop around. Maybe you'll be one of the lucky ones :) Good luck.

 

Permalink Reply by philip andrews on September 22, 2011 at 12:36pm

I 'VE BEEN READING ALL OF THESE COMPLAINTS,AND ALL IT DOES IS MAKING YOU FEEL BAD. THE 12.5 % THAT THE STATE IMPOSED YEARS AGO IS A LOT OF MONEY FROM THE GAS WELLS.I HAVE A 9 YEARS AGO LEASE,AND I TRIED THE SAME, TALK TO PEOPLE, GO TO A LAWYER,AND AFTER ALL THAT HE TOLD ME TO BE HAPPY WITH IT,FOR THE LEASE WILL LAST A 100 YEARS OR MORE. THIS IS JUST BUSINESS. IF A PARTY OWNS 10 OR MORE ACRES, THE ROYALTY WILL BE A LOT OF MONEY. A BIG WIND FALL. THAT'S  IF YOU HAVE 6 TO 8 WELLS IN YOUR UNIT. PHIL

RSS

© 2024   Created by Keith Mauck (Site Publisher).   Powered by

Badges  |  Report an Issue  |  Terms of Service