Replies to This Discussion

Permalink Reply by shelbyco on May 31, 2010 at 14:46

Tutt (A-727) just west of Tenaha
Lease expired in January, 2010
1/6 RI, $50/acre bonus
Had been extended once
Minerals were already under lease when I acquired them
Was leased to T.S. Dudley Land Co.

Permalink Reply by DJG on May 31, 2010 at 15:11

Might still take a while for this area (NW Shelby / C Tutt Survey) to be proved up, but in the long-run you will likely be happy that they did not end up drilling in order to get that land HBP at those older grandfathered terms.

Devon has a well drilling just a bit to the SouthEast of that survey, so if that comes in then it might help your overall cause with that survey.

On Petrohawk's most recent map they list that area directly inside of what they are calling the "Lane Shoal". Their interpretation is that the shoal would be pinching out the Haynesville Shale at that location, but their other Bossier map does show that the area still does look promising for Bossier.

In any event, I'd be happy that the minerals did not get HPB at 1/6 royalty as you should be able to improve that up to 25% when you eventually do end up getting leased anew.

Permalink Reply by intrepid on June 2, 2010 at 16:54

Just throwing this out. If your lease expires without production you may want to request the O&G company prepare and file a 'release of lease' on your tract and record it at the courthouse. This should put out notice that you have a tract that is not currently leased. Others may be interested.

Permalink Reply by adubu on June 3, 2010 at 4:58

excellent point intrepid

Permalink Reply by DJG on June 3, 2010 at 5:19

One thing to think about when negotiating any new lease would to also include a clause that sets the time period (90 days?) that the O&G has from the expiration of the lease before they need to file the 'Release of Lease" documents at the courthouse. You could also consider adding a stipulation where there is a monetary penalty for non-compliance of filing that document.

Permalink Reply by Skip Peel - Mineral Consultant on June 3, 2010 at 6:58

I'd give them 30 days. It's not like they made a last minute decision not to renew. That decision was likely made a good deal prior to the expiration date. And the lack of due diligence exhibited in the Haynesville Shale leasing demonstrates that lacking a release, many landmen will not catch the fact that the lease term has expired.

Permalink Reply by intrepid on June 3, 2010 at 8:41

I agree with the 30 days, Skip. Might also be a good idea to send the request to the company by certified mail.

D. Gaar brings up a good pont about covering it up front in your lease wit respect to a penalty for not filing the notice. But even if it's not covered by the lease language they sould still do it.

We have had releases filed by companies in the pas without having to ask. But, now, with he volume of activity it could be 'overlooked' easily.