What if I never lease and a well is drilled in my section? Wise investment for the future?

I'm considering not leasing my seven acres in section 13 in western Shreveport. 100 percent and no bonus is a lot better deal if it all plays out. This section is mostly wooded, somewhat rural, and should be attractive for a company to drill on. I have found very little on the subject and can find no one that receives royalties and did not lease. One website gave this information:


What are our options if we didn’t sign a lease with the gas company?

You either become a participating member or a non-participating member.
Explain these.

1) As a Participating Member you would participate in the expenses of drilling and maintenance for that well. You would also be entitled to 100% of the gas under your property. The gas company would have to approve you as a Participating Member.

2) As a Non-Participating Member you would not participate in the expenses of the well and you would be entitled to 100% of the gas under your land AFTER the gas company has recouped 100% of their drilling expenses and in some cases 200% of their drilling expenses.


I have heard talk of "forced pooling" and don't understand how that works either. Maybe its just a part of the above. Thanks in advance for any advice. Don Stamper, Shreveport



This is a repost from the south Caddo group since it got no replies there. Thanks, Don

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Permalink Reply by P.G. on August 18, 2008 at 12:37
With the production figures some of the wells have been making, it might be wise to not lease! Why settle for 25% and give away 75% for cheap bonus? The O&G companies wouldn't pay those bonuses if they weren't making a whole lot more.
According to what I found out on this very website, the drillers don't make a dime off of you if you don't lease. So they must be making a killing off those who do lease or they wouldn't be drilling in the first place!
Permalink Reply by BIGWOOD66 on August 18, 2008 at 12:56
What's ur Township ,Sec & Range over there Don? Just wanted to know because of that Encore proposal, but since I found the PLSS file I can see that no Sec 13 is included in those proposed 720 acre unitizations. That might have caused you some concern...
Permalink Reply by Angelonmyshoulder on September 10, 2008 at 12:28
what do you mean 720 acre unitizations? i live in section 13 township 16 north & range 16 west.
thankyou
Permalink Reply by drillbit on August 18, 2008 at 15:09
Don...you wrote: "What are our options if we didn’t sign a lease with the gas company?

You either become a participating member or a non-participating member."

If you so desire, you can become an unleased mineral owner and you are neither a participating member or a non-participating member. This scenario has already been covered in-depth on this site. Do some research by simply typing in "unleased mineral owner" in the search box at the top right of this page and hit the enter key. By so doing you will find all the info you can read.
Permalink Reply by P.G. on August 18, 2008 at 16:14
What would keep those who signed a lease from having to keep on top of the O&G company like you say the unleased would to get their share? Only, of course, 25%, rather than 100% of their part, less expenses?
They could screw the one's who have leases as well couldn't they?
Permalink Reply by P.G. on August 18, 2008 at 16:28
What about non-participating unleased land owners?
Permalink Reply by BIGWOOD66 on August 18, 2008 at 17:21
You are a hard man Jim.... I say lease,3 years, no bonus, contract to produce a minimum of 1 well in 6 months,with a 99% royalty.
Simple huh.....
Permalink Reply by BIGWOOD66 on August 18, 2008 at 17:38
Do not be too moral. You may cheat yourself out of much life so. Aim above morality. Be not simply good, be good for something.
Permalink Reply by drillbit on August 18, 2008 at 17:49
Jim...come on now. The people who read your comments are going to be scared to even consider being an unleased mineral owner. Hey, you are a CPL...how about some substantiation for your following comments:
1. "If you don't lease and are not represented by a competent oil & gas attorney, the chances of you ever seeing any money are slim." And, "The company keeps the books and you will have to sue them to ever get a dime."
2. "And best of all, you or your heirs get to pay for plugging and abandoning all of those wells." This sounds like the OPG is going to run off and stick the unleased owner with all costs of plugging and abandoning the wells.
3. "Unless you just enjoy an endless battle, attorney's fees and accountants fees, all out of pocket on your part, you might should consider leasing."
4. "The bottom line is that if you do not lease, you will spend a lot of money before you ever get any money."

Who, if any, of your past client OGPs have treated unleased mineral owners like you portray in your comments?
Permalink Reply by Don on August 19, 2008 at 1:52
Thanks to all. Sec, 13, (17, 15) Greenwood rd, Pines rd, Jefferson Paige, south, west, north. I'll check out Drillbit's suggestion and search to forum. Sorry to all that I have not tried it before making a post. Not to worry DB, Jim hasn't scared me yet. I don't believe everything someone types on the internet. Heck, he may work of Twin city but I appreciate his input. BTW Jim, I'm under lease in the the Elm Grove field and I still pay a lot of expenses and fees from my Royalty check and I only get 12.5%. These fees come out of MY money!

O&G companys will screw no mater,,, based on my 32 years of being "under lease".

Build a nice Log cabin way back in the woods, overlooking a beautiful meadow and guess where Stamper #3 goes! Now whats your investment worth. Nothing like sitting on the porch of your getaway home and looking out on the gray rocks, rusty tanks, bent pipe, and trash that used to be your paradise. I could go on and on for pages like this but you get the picture. I know, first hand, that they are not giving me a bonus because the like me or care about me. I trust lawyers more than O&G men and thats BAD!
Permalink Reply by BIGWOOD66 on August 19, 2008 at 2:06
"I trust lawyers more than O&G men.." That IS bad LOL.. Use the cash, build a privacy fence and get some ear plugs
Permalink Reply by P.G. on August 19, 2008 at 3:01
It doesn't seem right a land owner would become liable for driller's behavior if he was forced pooled and chose not to participate.

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