We have some TX acreage (25% minerals) that through clerical error and transfer of ownership was not exercised on a lease option with the rest of an undivided interest. The company tried to exercise on the whole parcel but payed the wrong owner(old lease, small money). Go figure. We also own some adjacent property that we have 100% interest in that is also now unleased due to the same issue. My question is: if part of an undivided interest is under lease and a well is to be drilled, how do they differentiate where the nearest lease line is if we lease to another company? Also, how do we try and keep my undivided interest contiguous with our 100% ownership? If it is put in a unit then is it first come first serve on where that line is drawn on that undivided interest? How or can they differentiate something that is "UNDIVIDED"? I am confused on this one need some help. My fear is that we would have less leverage if both parcels are split up. Any feedback or suggestion as to the best possible way to handle this would be helpful. This land is in San Augustine County in what they are calling the County Line Field, our ownership is about 70 acres out of just about 250 total that was originally under lease.

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Jim, Is it impossible for me as an unleased owner to keep my two parcels together if one is an undivided interest? In other words, the company that leased all of it originally can slice me right down the middle in a unit and I would hold two parcels divided by the unit that was created? How many acres would someone need to drill a James Lime well?
I guess I better hurry up and get leased with them then! Sounds like my other options are very limited. Can the same undivided parcel be in two seperate units or is it the first one to put it in a unit gets it sort of thing?
Dang, I hate those things : )

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