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Reeves County, TX - Oil & Gas Discussion

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Reeves County, TX - Oil & Gas Discussion

Oil & gas discussion group for those interested in Reeves County, TX. Share your experience regarding lease bonus, royalty rates, drilling activity, and oil & gas news.

Members: 601
Latest Activity: 1 hour ago

Discussion Forum

1031 exchange question

Started by richard roberts. Last reply by Melody a moore-jaehne 1 hour ago. 6 Replies

hello, we are completely selling our minerals (and keeping the surface) but keeping a npri (non participating royalty interest).  can we use a 1031x in this case are does retaining the npri prevent…Continue

PSL lands in Reeves county and activity in the area of our land

Started by David G. Rosenfeld. Last reply by Bobby Grace yesterday. 6 Replies

My name is David G.My sister and I own 160 acres in Reeves County.  The property as described on the real estate tax bill is: BLK C-17, Tract 8, AB 2414, SEC 8, PSL W/4.  I have 3 questions:1.  What…Continue

Surface damages

Started by John O'Neil. Last reply by John O'Neil yesterday. 3 Replies

If there are different owners of surface rights vs mineral rights, who is entitled to surface damages?Continue

new "lease" on producing property

Started by mick h. Last reply by Bobby Grace yesterday. 16 Replies

Hi,We have acreage with a current lease and a well nearing completion. I just received this offer that I am pretty sure I understand, but wanted more expert opinion, as well as offer a cautionary…Continue

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Comment by M A Smith on Thursday

It is.  Thanks.

Comment by Bobby Grace on February 19, 2017 at 12:53pm

MA, another useful and interesting site is John B. Mcfarland's

http://www.oilandgaslawyerblog.com

Comment by Bobby Grace on February 18, 2017 at 4:52am

Thanks for the references MA. I was not aware that there was any debate about the two terms. Horizontal is what you are when you are dead - parallel to the ground.  When you're walking and talking, you are vertical.  That's how my clients view it, and how I report it.  I'm old and stubborn.

Comment by Melody a moore-jaehne on February 17, 2017 at 4:02pm
My friend has 3.1 acres in Balmorea Block F. I'm trying to run some title on his minerals to see if he can drill a water well. I'm seeing zero reservations on his Deed and the Deed before him. I don't live in that county and the online site would be costly. The acreage is close to the water and my belief is that the minerals were tied up in the RAct in the early 1900's. Can any of you help me?

Pro
Comment by Wade Caldwell on February 17, 2017 at 3:54pm
Comment by M A Smith on February 17, 2017 at 1:05pm

Bobby:  It should also be noted that "Retained Acreage" clause in the standard Relinquishment Act Lease Form used by the General Land Office of the State of Texas (used for leases of mineral classified land) follows the nomenclature you described.

Comment by M A Smith on February 17, 2017 at 12:58pm

Bobby:  Yes, there is a great deal of confusion about which is which, and there is a lot of debate about the nomenclature.  The terms themselves have no legal status.  They are just a description of the clauses.  They often appear in a lease as "retained acreage" or some variant. One must read the actual clause to see what it entails.  Yours is the older definition of how they were described.  Many recent references have the reverse of that usage.  That's the direction I took.

A website following your definition:

http://www.theoilandgasreport.com/tag/pugh-clause/

Websites following my definition:

http://www.landmen.net/clausesforms/clausesforms.htm

http://pagasleaseattorney.com/oil-gas-terms/pugh-provision/

https://www.law360.com/articles/549015/top-o-g-leasing-issues-pooli...

https://definitions.uslegal.com/p/pugh-clause/

Comment by Bobby Grace on February 17, 2017 at 11:18am

I believe you have the horizontal and vertical Pugh Clauses reversed.

A Horizontal Pugh Clause releases depths below (and / or above) a particular depth, while a Vertical Pugh Clause releases acreage outside a pooled unit.  Most Pugh Clauses I've seen in the last twenty years have been both Horizontal and Vertical.

Comment by M A Smith on February 17, 2017 at 10:47am

Todd:  I was referring to a "vertical" Pugh Clause.  

There are two kinds of Pugh clauses, “vertical” and “horizontal.”  The purpose of a vertical Pugh Clause is to release depths in a pooled unit below the deepest producing zone at the end of the primary term or after cessation of continuous drilling operations. A variant of the vertical Pugh Clause may also release all depths except the producing zone, even the shallower zones.  This is less typical, and lessors will push back on it.  They will, however, give you the version releasing deeper zones.

The horizontal Pugh Clause operates to release all lands not included in a pooled unit.  It releases land at the surface as to all depths.

In theory, neither of these should affect royalties.  They release acreage and zones that are not contributing to production in the pooled unit from which you receive your proportional share of royalties of production from the pooled unit acreage.  The pooling, on the other hand, would affect your royalty if some of your acreage were excluded from the unit or if someone else's happened to be included, thereby changing the shared proportions.

Comment by Clint Liles on February 16, 2017 at 10:38pm

Thanks Buzz for the info.

Clint Liles

 

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