Here is the area for questions about leases. Mind you the information you hear should not be considered as legal advise but it will possibly shape a better session with an attorney if you have some basic knowledge about a lease. By all means, in the amount of money one may make in this shale play legal advice is worth its weight providing that attorney is working for you.

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 I say there's a lot of questionable situations out there. Here's another.  An Ohio landowner I know has 70 + acres they've owned for 20+ years. His property came with a 1960's lease & a pipe sticking out of the ground. The owners who signed the lease in 1960's also owned a 100 acres several miles away refered to as tract 2 in the same lease. Tract 2 has a producing well. The lease lists the units as 70+ acres (tract1) 100 acres (tract 2).  Fast forward to 2012. The 2 tracts have been owned by seperate parties for years, & on top of that odnr. lists the wells as being owned by seperate companies. The well on tract 1 was listed simply drilled with no production ever. The well on tract 2 has a production history through today.  Obviously this lease was split somehow at some point in order for 2 different unrelated companies to own the 2 wells drilled from the same lease. So is tract 1 in any way impacted by what happens on tract 2? Tract 1 has never received a dime from the well on tract 2.

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WOW and I thought I threw out a situation! The lease may have not been split but rather the working interest was reassigned. 

BEWARE

If approached by a person wanting to lease your property. The document in this article has been questioned as to its credibility in more ways than one. As you will see it attracted the attention of some of Ohio's legislators as well. After you read the article scroll down and read the document, keep it for reference. It describes tactics that a crooked individual might use to get you to sign a lease. If you see this developing in a conversation beware.

 http://glasscityjungle.com/2011/04/fedor-calls-for-investigation-in...

Why should you care? Read the story then think of my comment.

http://www.newarkadvocate.com/article/20120209/NEWS01/202090326/Sud...

I posted the following in the comments:

However interesting this story is is just a cracker crumb . I advise all land owners to get educated in the knowledge of leasing their property. Would you burn $300,000? You very easily could. 
Example: I lease say 50 acres for say $500/acre = $2,500 and get say 12.5% royalty (the old industry standard where as now royalty can be as high as 20%)
They drill a Clinton well at 3,000 feet, they do not frack it and it produces say 25/ bbl/day so I would get about $114,000 the first year (note oil wells drop in production so that is a high figure) main point here is it is a producing well it might only make 5bbl/day it still is a producing oil well. Under the terms of the lease I did not see they as long as they have a producing well have ALL THE OIL AND GAS and a small clause that says UNITIZE.
They sell the lease to say a bigger company at $4000/acre. They just made $197,000 that I might have been able to have had plus they will get a over riding royalty.
Big Company unitizes my property into a 640 acre unit (the big horizontal process) and say the well comes in at 1000/bbl/D I would get $365,000/year, had I been able to have leased myself to the big company at say 18% I would get $513,000 a year so we just burnt $197,000 + $148,000 = $345,000 ! As stated well production will drop off but you lost the $197,000 forever and the percentage of the royalty will be forever a loss. 
That was a hypothetical upon a 50 acre plot. The first calculation was based upon just a 50 acre plot at 12.5% the other was in a unitized unit of 649 acres. 
Is it worth you being educated, you decide.

Here will be a very interesting case to follow. It appears as someone on the side of the landowners was a bit more shall we say observant of possibilities?  As landowners faced with the possibility of leasing it is important to know about leases. Here is the thread upon it at GOMS= Go Marcellus Shale

Chesapeake sues landowners over old Anschutz Leases 

http://gomarcellusshale.com/forum/topics/chesapeake-sues-landowners...

 This could mean a way for landowners to be getting a fair value for their lease.

Mark from the way I read it I really do not know:

The language in question

Preferential Right to Renew. If, at any time during the primary term hereof, or within one (1) year from the expiration, cancellation or termination of this Lease, Lessor receives an acceptable, bona fide third-party offer to lease the Leasehold, in whole or part, Lessor shall promptly provide the Lessee, in writing, of all of the verifiable particulars of such offer. Lessee shall have thirty (30) days from the receipt thereof to advise Lessor, in writing, of its agreement to match said third-party offer as to all terms and consideration; immediately thereafter, Lessor and Lessee shall take all cooperative steps necessary to effectuate the consummation of said transaction and the survival of said transaction through any statutorily mandated right of cancellation thereof. Any lease or option to lease the Leasehold, in whole or part, granted by Lessor in contravention of the purposes of this paragraph shall be deemed null and void.

Source: 2008 landowner oil and gas lease with Anschutz Exploration Corporation

   It will be interesting to watch.

Mark here is something I find interesting. In what I have seen working interest and lease that are on record usually state for a price of say $10 in the reassignment. We both know that they do not sell flip 3,000 or more acres of land for $10. Do you know how this is done?

  I personally do not care for the take it or leave it attitude at the land owners meeting i have been to. I have seen no suggestion of a constructive meeting of were land owner input has been the focal point. We get here is the lease we are going to sell. Excuse me? Not without my name on it!

  For an example I'll through a few things out here. A surface damage clause of $3000/ acre. So they put a well pads on the adjoining neighbors property but they make ingress and egress through the middle of your pasture that is say ten acres. Question will the pay damage by the measured sq foot for the roadway or by the acres they went through? Fair question I believe. Another one was the all formations are leased. I asked after te meeting and was told well no company will buy the lease without getting all of it. Well the Utica is sure better than nothing in my book.  Another point is coild they come back years gown the road and punch into the rise run formation, possible and no new lease bonus at that point,. What if they decide to connect the Clinton wells by horizontal drilling to grab the untouched formation between the wells? 

  Na this should be point specific! 

 Thanks for the input Mark questions like these are for the most part never heard at a landowners meeting where it is not a true landowners meeting. Sometimes I view a land owners meeting as a live stock sale from the attitude of the speakers. 

How can you get a lease back into your control? see http://gomarcellusshale.com/group/ohio/forum/topics/ohio-surface-ow...

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Rumors are David R. Hill is in the Licking Valley area trying to lease you land BEWARE!!!!!!!!!

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Thanks for the info. If anyone can get a copy of the lease he is trying to sell please do, copy and paste it here and we will check it out. 

I have property that is held by production by a vertical clinton well under an old lease.  The lease permits the lessee to consolidate the the leased premises with other lands to form an oil and gas development unit of not more than 160 acres, or the amount of acreage contained in a lot or section of land in the township in which the leased premises are located, whichever is greater.  I believe this is the "pooling" clause.

 

The above verbiage was in the standard lease agreement.  An "addendum" statement that was typed (added) to our lease is, "This tract of land will not be unitized without written permission of the Lessor."

 

What is the difference between pooling and unitization?  Will the "addendum" statement prevent a 640 acre drilling unit from utilizing our property without our written permission?  Our property is much less than 640 acres.

 

 From what your saying your lease limits the amount of your land being used to 160 acres.  The addendum would keep it restricted to requiring your permission. 

  Several things here, have you checked to see if the lease has been reassigned to another company?  Check your county recorders office. Since you have that in your lease it may be preventing the lessee that has the lease from trying to sell the lease. You might like to look for any depth restrictions in the lease, any no reassignment clause as well. 

   I am not an attorney but the more you know about what your lease reads and where it is kind of gives you a heads up. 

 If your lessee has not reassigned the lease might be possible to negotiate with him as well.

  Give it a good look and throw the questions back in here. 

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