What happens to "non-leased" acreage in a producing site?

If a company can not find all of the mineral holders within a play to lease their mineral rights- What happens when the production starts?  Where does the money for the non-signed mineral rights go?

 

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Thanks

Jay is correct, the operator will hold any money owed in escrow or "suspense" until the owner(s) is located.

In Louisiana, the operator is supposed to send royalties/payments that have not been claimed to the state to hold in escrow once they go unclaimed after two years. In Texas, they go to the state after three years.

Take note, however, that unleased mineral interests inside a Louisiana unit will not receive any money until the well costs are recovered (i.e. it "pays out"). For more on this topic you should check out this thread.

Thanks Andrew

Figured it was something like that.  Do you know if MS has the recovery clause as well?  Wonder how long the states must hold the money before they take it as state income?

I'm sure MS has a similar statute, as virtually all states have some version of the Uniform Unclaimed Property Act. The years may vary but the principles remain the same.

In the states I'm familiar with, the property isn't taken by the state for at least 10 years after the state has the funds. Some states hold it for decades.

State treasurers maintain lists of those who have unclaimed monies held in escrow by the state.  They periodically publish the lists in newspapers.  I would suspect that many now have websites that include a link to that list.

Thanks for the follow-up

Thanks for the follow-up

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