Replies to This Discussion

Permalink Reply by Skip Peel - Mineral Consultant on August 15, 2013 at 7:11

If you do not receive notice and a check from the lessee before midnight of the expiration date, the lease expires and is no longer in force.  If this has happened you should send a certified letter to EnCana, or have your attorney do so, directing them to file a notice of release of O&G lease in the public records of San Augustine County.  The release will let any interested parties know that your mineral interest is not burdened and may be leased. Melinda, a lot of leases have been allowed to lapse not just yours.  The reason in most cases is economics as opposed to the quality of your minerals.

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Permalink Reply by Joe Aldridge on August 15, 2013 at 7:18

Melinda,

In Louisiana all you have to do is ask for a recordable release from whoever holds your lease. Do that by certified letter. They have  60 days (I think) to file the release in the court house. I don't know about the procedure in TX. Someone from TX that has knowledge hopefully will respond.

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Permalink Reply by William C. Morrison on August 20, 2013 at 4:19

I live in Texas atop the Barnett Shale.  My lease expired and I did indeed write Devon and got a release.  It cost me $20 to get it filed.  The well near us has run its course and is gone.  Not just  shut down, but gone.  The pipeline connection is still there but that is all.  It lasted about three years.  That tells me our little bit of land is not worth the effort to release.

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Permalink Reply by Joe Aldridge on August 20, 2013 at 4:31

Hi Chip,

First, you should have had the company file the release and send you a certified copy. Secondly, there are always possibilities. I think you have to realize that you were with Devon. They only seem interested in picking cherries. They are not interested in long term secondary and tertiary production. There's always someone else that may see something that Devon didn't. 

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Permalink Reply by P.G. on August 20, 2013 at 5:47

What happens if one never gets a letter releasing the lease after expiration?

Would a driller miss leasing your land if there were no release of lease filed?

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Permalink Reply by Two Dogs, Pirate on August 20, 2013 at 7:34

PG I look for producing wells before I start contacting the folks. For non-producing wells, I look at the date of last production and the well status code. If the well has been down for longer than the time provided in the lease and the status code isn't shut-in, then I start the lease process. Many leases never get released.

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Permalink Reply by P.G. on August 20, 2013 at 8:26

In our section...there are no wells.

Several other sections in the township are drilled though..

17n 15w

I would assume if they did drill..they'd look at all recorded leases

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Permalink Reply by William C. Morrison on August 20, 2013 at 5:51

I did just that and I did and do have a certified release.  I filed it anyway as I don't have a great deal of faith in the local Clerk of Court shop.  At least this way I know it was done.  There are 90 some odd homeowners in the subdivision and I am sure I am the only one to do it.  We had a couple who did not accept the original lease (and are out about $1,500 due to their ignorance, bad advise or whatever.  The rub is we abut to a 200 acre tract that the landowner refuses to do anything including clearing the land (we have a deer herd problem because of her).  But sooner or later she will pass on and things will change. 

But until then, we owners of an acre here or there are at the mercy of the big land owners here in Texas.  And since the wells around us seem to have now played out, we are probably not going to get any action.  So those fools who did not take the lease lossed out.

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Permalink Reply by Dion Warr, CPL on August 21, 2013 at 5:33

Melinda:

It clears your title, you've earned it, you're due it - send a certified or registered letter return receipt requested and get a release.  This ensure that your mineral rights are unleased and back in your hands, to do with as you will.

 

Doing lease and mineral checks for the industry, landmen can and will determine (or attempt to determine) lease status on tracts within prospect areas, of which many lessees / operators never see fit to file releases of record - it does not halt us in what we do, we just have to determine the status based upon specific performance of lease obligations.  But a recorded release is just cleaner.

 

Additionally, if you are dealing with a lessee / operator who is attempting to tenuously hold on to leasehold with marginal (or no production) and (alleged) good-faith operations, it will serve to put them on notice that you are not interested in playing games - the message is "operate, complete or recomplete, produce (in paying quantities), OR plug and abandon and release".  The correspondence in obtaining a release will set the groundwork and timeline for your expectations even if the lessee / operator is loathe to grant the release.

 

Put it like this - even if you have to file the release - is it worth a few dollars to clear your mineral title and pave the way for the next deal involving your interest?

 

Good luck to you in your future endeavors.

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