Replies to This Discussion

Permalink Reply by Lynn Wigglesworth on February 22, 2016 at 1:40pm

Did you have a PUGH clause in your original lease? Maybe they are renewing the lease on the part of the land that is covered by the PUGH clause? Under the PUGH, the lease on the part of the land that is NOT in a unit will expire when the lease is up; any part of that land that is in a unit is held by production. That's the only thing I can think of involving a PUGH clause.

Permalink Reply by N Bohl on February 22, 2016 at 3:46pm

I know of at least one case where someone had a horizontal Pugh option - was not entirely unitized and received a check to extend the lease a couple of months before expiration. That may be automatic for Swepi to do. It is possible that you are in a situation where you can request a surrender of that part of your acreage but if you deposit that check I believe there is a good chance you are legally extending your lease. But something to consider - if the current terms of your lease are better than anything you think you will be able to negotiate in the future - that is something to think about.

Permalink Reply by 0ym9x5ag7ury2 on February 22, 2016 at 4:49pm

In Ohio, all of the ALOV and SURE leases have the Pugh Clause.

If you have half an acre under production (supposedly) from 1250 plus feet from a lateral, or the next county over, you should consider this when it's time to renew.

As we know, THOSE PEOPLE will try to fool you into thinking all of your land is held by production. Did I mention they don't read our leases let alone comply with them.

The Division Orders may be a bit late due to the need to keep your royalties for as long as possible without payment. March 12th will be 5 months of production with no Division Order at Paige Well 5H. Anyone home at the ODNR?

Permalink Reply by NightHawk®™ on February 23, 2016 at 12:12am

This is why we are confused. The unit (Allen 620) that is written on the check is a unit we haven't been contacted before this, stating our land is even included. So are far as a PUGH clause for this unit, we never formally received a offer from Shell.

If someone could provide contact info for a Shell rep in the area, would be great.

Permalink Reply by 0ym9x5ag7ury2 on February 23, 2016 at 9:24am

What you need are some of the PA Interactive Maps that show where the drilling is located so you will know where the wells are that have been drilled and are under production, but you haven't been sent a Division Order to date since there is a legal time period producers have before sending you the Division Order.

Try this PA Oil & Gas Mapping Website:

http://www.depgis.state.pa.us/PaOilAndGasMapping/

Good Luck, and remember, "If they're Drillin, they're Stealin".

Permalink Reply by scott brion on February 24, 2016 at 4:09am

Hi Night Hawk,

I have shell leases in Tioga county.  Shell has been attempting to use "pugh clauses" to extend leases in a blanket fashion.  It is a little counter intuitive as the pugh clause was meant to see undeveloped acreage released.  Need to understand all your details to see if it is a legitimate claim or one you might want to contest.  Happy to try and help.  Feel free to add me as friend and message if you care to discuss.