I have read you post regarding 7 unleased acres in a drilling unit. I am from Woodville and practiced law before the Oil & Gas Board for a long time, and so thought I would comment on your situation. You have since gotten the applicable statute 53-3-7, but I don't see that you have been given the precise advise I would give. first, if you did not recieve a certified letter from the State Oil & Gas board notyfying you that you are being put under the penalty (Section 2) then you are not under it. The most the drilling company can do is recover the costs expended in drilling your 7 acres with the productionfrom those seven acres, plus a reasonable charge for supervision. After that, you are entitled to 100% of your 7 acres, less cost expended each month to operate the well. Ordinarily, this is a good place to be, but there are two problems: They are still spending large sums and "payout" of the well may be years away even with honest bookkeepers; but the customary large oil company in such situations tends to "pencil whip" a small owner who cannot afford lawyers and accountants to minitor the books. (Example: a Vice-President of Company X flies from houston to Denver to a meeting. The Tuscaloosa is discussed for 10 minutes. a part gets billed to your account.)
You are likely not leased because the companies are so overloaded, they have time now to look only for the larger interests. if the well tests very well, they may then come to you and ask you to lease. You could go to them and offer to lease if you wish--show them documents which establish your title--save them some time--and they may well take it. Most such decisions depend on the financial situation and risk tolerance level of the particular landowner. Just thought I would try to help.
Hello! I hope the site is a place for you to learn, network and contribute. My name is Keith and I started the site in June of 2008 to open up lines of communication between landowners. Since then, we have grown to over 13,000 members.
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As exciting as this is, we know that we have a responsibility to do this thing correctly. After all, we want the farm to remain a place where the family can gather for another 80 years and beyond. This site was born out of these desires. Before we started this site, googling "shale' brought up little information. Certainly nothing that was useful as we negotiated a lease. Read More