From the Banner-News of Magnolia "Diary" column, Tuesday, Oct. 14, 2008:
Celia McQuiston, land manager for Albemarle Corporation, has responded to recent inquiries raised in this column about brine leases and potential natural gas leases.
She said lessors sometimes ask if they have the right to lease their oil and gas rights on lands that have been previously leased to Albemarle. The answer is, “It depends.” Says Celia:
“Our present mineral lease for the purpose of brine production is a brine lease. A brine lease does not generally cover oil and gas mineral rights. If Albemarle is acquiring mineral rights around a prospective new production well, we will seek to obtain, in addition to the brine lease, an oil and gas lease in the event that the new well produces incidental quantities of oil or gas with the brine. If Albemarle holds an oil and gas lease in a 40-acre tract around one of our brine production wells that is producing marketable oil or gas, then lessors will receive a check from Lion Oil for oil royalties or a check from Albemarle for the gas royalties.
“Certain older leases area oil, gas and mineral leases, meaning that the oil, gas and brine rights were leased at the time the contract was signed. Some of these leases cover lands upon which oil and gas wells are drilled in shallow formations above the brine-producing Smackover in our fields. In this case, because the area is unitized and there is current oil and gas production, lessors again receive oil and/or gas royalties. Where there is no current oil and gas production, no royalties are paid.”
Lessors with questions about Albemarle leases may call McQuiston at 870-235-6371, or toll-free 800-745-4073.