Executive versus Non-Executive on Texas O&G Lease contract?

In Texas, there are five elements to the mineral estate:

1. The right to enter into an oil and gas lease (the Executive Right)

2. The right to receive Bonus

3. The right to receive Rental

4. The right to come and enter the property to explore for the minerals

5. A cost free share of production (royalty)

A Non-Executive Mineral Interest is just that. The ENTIRE mineral interest stripped of the right to enter into oil and gas leases. The Non-Executive still gets his share of bonus, rentals, royalty, and the rights of ingress and egress.

A non-executive mineral interest will require the joiner of the non-executive to pool the interests. The reason for this, in Texas, is that the pooling transaction creates a cross conveyance of minerals. The holder of the minerals, or the executive, does not have the right to convey the property of the non-executive.

There COULD be immense harm in the non-executive agreeing to pool his lands with another. Only an examination of the factual situation would reveal that. On the flip side of the coin, it could be in the non-executives favor to ratify a lease as to pooling.

You do not need to ratify a lease to get your share of bonus, rentals or royalties. They will ask you to sign a receipt showing that you received the bonus, but that is all.

You might want to read this blog post:

http://www.mineralrightsforum.com/profiles/blogs/npri-npmi-nonexecu...

Best wishes,

Buddy Cotten