Replies to This Discussion

Permalink Reply by Bobi Carr ("parker") on March 13, 2009 at 16:25

Jim,

Do I understand correctly that the minerals servitude would continue indefinitely until 10 years after production ceases?

If it is drilled for HS production then it would not cease until 10 years after said production ceased?

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Permalink Reply by Bobi Carr ("parker") on March 13, 2009 at 16:52

So, simplified, the servitude would exist for 10 years after production ceases or 10 years after a well is plugged.

It would exist indefinitely as long as there is production. Correct?

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Permalink Reply by Spring Branch,mineral owner on March 14, 2009 at 12:55

Jim Krow, what happens if they don't make a producing well, but don't plug it either. I have seen language on Sonris like, "may have some future utility" and the well does not appear to be plugged. Will that keep prescription from starting, and how long can an operator leave a well unplugged but not producing?

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Permalink Reply by Jay Murrell on March 14, 2009 at 2:53

Phaco:

One more thing.

You can do a bunch of your due diligence on this site without revealing the location of your proposed purchase. I assume you have bought minerals before and know what to look for. That said, undeveloped Haynesville rights could be worth lots of money, or, nothing at all. Fact is, the boundaries of what the primo Haynesville is yet to be defined.

In other words: Caveat Emptor.

Good luck,

JM

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Permalink Reply by herefordsnshale on March 14, 2009 at 12:33

What if there was no depth clause? To my understanding most older leases did not have them. The CV wells could be holding ALL minerals couldn't they?

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Permalink Reply by Jay Murrell on March 14, 2009 at 12:48

A depth clause in the lease wouldn't have any effect on prescription. You could have a lease from surface of the servitude to 3000' which is producting. That shallow production interrupts prescription for the entire contiguous servitude. Don't confuse leasehold with mineral servitudes.

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Permalink Reply by Jay Murrell on March 14, 2009 at 12:45

If Phaco has the expertise to do his own due diligence then he won't need any help.

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Permalink Reply by Jay Murrell on March 14, 2009 at 12:58

Jim:

To expand, I've read and cured a gazillion title opinions over the past couple of years and that exercise has made me more cautious. I suppose its a function of how much money is involved and one's willingess to assume risk.

JM

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Permalink Reply by herefordsnshale on March 14, 2009 at 13:14

Seems like I remember someone posting on here that a well could be "shut-in" for three years. In my case, my minerals were being held by a shut-in well that either dried up or the shut-in period expired. Then the company went and drilled a dry-hole, I wonder if they drilled at all since the time from spudding to plugging was one week. It could have been just a manuver to try and start the clock over. But it didn't last. Nothing else happened and 10 years later i got the minerals. I'm one of the few people that have been so fortunate.

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Permalink Reply by Jay Murrell on March 14, 2009 at 14:36

Hi Hereford:

The are lots of wells that are in the shut-in future utility catagory. They are usually not holding squat. It's all about the operator not wanting to spend the money to plug the well. Clock starts ticking on the date of last production, regardless of the shut-in status of the well.

BTW, the only legit reason to shut-in a well (other than for re-working) is lack of a market.

JM

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Permalink Reply by Two Dogs, Pirate on March 14, 2009 at 14:37

Waiting on pipeline is another.

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Permalink Reply by Jay Murrell on March 14, 2009 at 15:02

WO pipeline is the same thing as lack of market.

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