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We have an EOG 3-year Lease that paid an original bonus in 2012, royalties ever since, but no Bonus since the original.

Does one have to take some action in order to get this bonus?

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Bonus was paid on signing lease for right to explore and drill during primary term of lease (most commonly 3 tears).  If well began producing during primary term of lease then no additional bonus is due.  The lease continues as long as there is production.  Additional bonus for option to extend is only paid if production is not established during the primary term    Your lease may contain expiration for acreage not drilled or depths / formations not drilled, but that is a separate matter.

Thank you.  Perhaps I misinterpreted the contract as it appeared that another bonus would be granted with each term.

Look at granting or term clause in lease - The term is 3 years (or other primary term) and as long as production continues.  It is very different from a rental or other contract.  You get the bonus for signing and then once production is established, the oil and gas lease continues for many years.  I have seen leases which have lasted 100 years.  During that time, the only revenues are royalties.  The bonus is a one-time incentive to sign the exclusive rights to drill and explore to the oil company lessee.  You may have granted an option to extend in the lease.  This option would allow the oil company lessee to extend the primary term for an additional period such as 2 years.  The oil company will only pay an extension option if production was not established within the original primary term.  If your current lease expires when production ceases, then you will have the opportunity to sign a new lease with a new company and get paid a bonus on that lease.

Jack:

I'm just another mineral owner; but, IMO all of that depends on the following.  These are my thoughts.

#1.  If the property/minerals under lease are in production, then unless you have something special written in your lease, then the minerals included in the pool will no longer be subject to a bonus until production has ceased and you get a release from the operator.  From your post, it looks like you are getting production royalties.

#2.  Any leased acres not in production should be subject to the bonus provision and most all operators pay that bonus before the first three year primary term expires.  If the bonus is not paid prior to the first three year term, then my opinion would be that these acres are no longer under lease.

Good luck!

Jack:

I was in a hurry and didn't read over my post as thoroughly as I should have.  I made a mistake in #2 of my reply.  It should have been as follows:

#2.  Any leased acres not in production should be subject to the bonus provision and most all operators pay that bonus before the first three year primary term expires.  If the bonus is not paid prior to the (end of the) first three year term, then my opinion would be that these acres are no longer under lease.

I'm sure you will get some more responses; but, please do your homework just to make sure the lease is being followed.

Once again, Good Luck!

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