Replies to This Discussion

landownerPermalink Reply by DJG on June 30, 2011 at 16:10

Is your attorney well versed in oil and gas issues rather than just general council. If not you would be well advised to have an oil and gas specialist attorney review your documents. Too many items can be overlooked if not vetted properly.

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Permalink Reply by william h mcgrath on July 1, 2011 at 0:47

I have a very strong and expensive O&G attorney that has experience in E TX and LA.  He has verified what I have questioned and helped me with the correct wording to structure the lease. He has considered far more things than I have, and I am very confident with his advise.

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landownerPermalink Reply by adubu on July 1, 2011 at 0:41

make sure you are leasing to the operator that will be drilling the well and not a flipper.

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Permalink Reply by william h mcgrath on July 1, 2011 at 0:48

The operator hopes to drill a well within 24 months.  He is not a flipper.

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landownerPermalink Reply by DJG on July 1, 2011 at 1:41

Sounds like you are doing your proper research prior to signing. If they say they are prepared to drill, then they should be willing to go with a 2 year lease with no options to extend. Might even see if they would consider a 1 year. If your attorney has not already pushed for this I would highly advise that you try and negotiate a "Continuous Operations" clause to your deal in order
to assure that your minerals do not get HBP'd for decades with only 1 well drilled. Good luck to you.

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landownerPermalink Reply by DJG on July 1, 2011 at 1:45

You did not previously mention the royalty rate for your offer. Have they offered 25%?

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landownerPermalink Reply by adubu on July 1, 2011 at 1:49

DJG--- what's the best "continuous operations" clause you have seen on leases that operators have agreed too? Which operators are you aware of that have agreed to this clause? THX for answer.

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landownerPermalink Reply by Hale Yayuh on July 2, 2011 at 3:04

My guess is NONE of them.

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landownerPermalink Reply by DJG on July 2, 2011 at 22:42

Not sure about other operators, but we were successful in getting Devon to agree to a Continuous Operations clause in our deal. Was not an easy process but we did eventually get this included.

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landownerPermalink Reply by adubu on July 6, 2011 at 0:46

DJG-- what was wording of the continuous clause DVN agreed on? Please post, Thanks

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