Has anyone received a permission to do a survey from Gateway for XTO. This is for Love, Carter and Cooke counties and contains a huge area that they want permission to do this. Is this something that is ok to sign...not sure how it effects me one way or the other...they attached Exhibit A with county lines but no names so very confusing...I called and said I needed more specific information on exactly what they are doing it on.
There should be an offer ($$ per acre) from the company wanting to perform the seismic survey. They come in with big chipper/shredders to make pathways for the seismic trucks. The transacts that they perform are used to lay cable to study the earth's geological formations. Depending on what type of land you have, the company should offer you a substantial amount of money to come and perform the study.
Andrew,
I think she only own Mineral Rights. I have received a similar letter for an area we own mineral rights in but no surface rights.
The money received for Seismic, how is it taxed? Ordinary income or can you claim as damages?
If the mineral lease states it as "incidental damage" than its damages. If the lease states it is just for "access" to the land than its normal income.
J said:
The money received for Seismic, how is it taxed? Ordinary income or can you claim as damages?
good point.
Rick Howell said:
Andrew,
I think she only own Mineral Rights. I have received a similar letter for an area we own mineral rights in but no surface rights.
I received the same, unless you own surface just sign it and return it. You as a mineral owner have the right to egress and ingress and that is what they are asking permission for and if it looks good XTO will lease your minerals. There is no financial gain to mineral owners just to give permission, only if they lease and or drill will you make a dime. If you are a surface owner then you need to negotiate an agreement and payment.
So the only downside is if the 3D reports nothing worth drilling? Then that could negatively impact the lease potential in the future. Most of us do not have enough of an interest to stop the survey of our area, even if we chose to do so anyway.
Rick, that’s what I was thinking. If we could prevent them from doing a 3d they would have to drill to find out what’s under there. Thus a lease. I will see if I have surface rights and what areas they want to survey when I hear back from them. I know 16-5S-1E, for sure, then 5S-1W, 6S-1W, 6S-1E, 7S-1-E, 7S-2E 7S-1E in Carter are some of areas. Also on the map are Love and Cooke with similar ranges going east and west of the Carter… Hopefully some leases will come my way. which is a good thing.
The 2 of you, that doesn't make a lot of sense but it would be okay if they find and drill on mine and skirt around yours. I would think if your minerals have less value you'd want to know and they are just looking for the Woodford formation right now. What both of you are saying doesn't sound good at all, sounds like a used car salesman that won't disclose the car was in a flood or your buying a house they know has termite infestation and they refuse to let you do a house inspection or disclose it. Or oil companies like Chesapeake that give you a no deduction lease and then deduct everything because you don't know better and they prefer to cheat you to get your money out of greed. It really doesn't sound good what your saying, surely you didn't think about what you were saying and didn't mean it.
Joe, I don’t think your analogies really apply in this case. I don’t know what oil is there of not and I’m not telling anyone there is oil there. So is it a disclosure or misleading issue? I don’t think so.
Why should someone allow them to “explore” for oil without compensating the owner? I don’t believe they will share all of the results of the testing once they are complete. If a good formation is found they will share it with investors and or operators who will try to lease from me as cheap as possible without “disclosing” the formation is there and what the potential is. Is that ethical?
I’m not sure of the answer and just said that was a possible negative. I don’t know if the negative outweighs the positive or not.
I guess I was so taken by what you 2 said I just didn't take the time when I replied. I should have left out the word know and just put refuse to allow inspection. As for why you'd allow them to explore, it's because you might get a good producing well. As for letting them explore and you not get a piece of the pie, state you'll give them permission if they share the results, it has been done before and agreed to it. I feel the oil belongs to everyone in this nation and we should feel lucky the government is so stupid to give it to us. I don't know why they'd give us everything under surface and not everything above it to outer space, I'd hate to negotiate flying in a plane had they done so. As long as we pay taxes we are only renting and it can be taken away, it's surprises me they allow us to use everyone's oil. I do see your point, same as I did, it was probably more the way you first stated it.
Wow…this is being blown way out of proportion. My point was in their form that I sign and will be held to, wants me to allow them to do anything they want. Maybe you sign just anything but I don’t. I am on this forum to learn and I have learned the oil companies want what is best for them not me. I have signed these before but for a specific area…i am merely questioning the verbiage in the document and it is very vague. It is an opening for them to do other things. That was my concern. I want to lease just like everyone else does and I have made mistakes so am still learning. You are being a bit assuming with your “refusal to sign” remark. I never said or thought that. I just want more information and wondered if anyone else knew what was going on.
should be vs. Tsking whatevet they offe information if yfuture.
Disregard that last post. Rick, thanks for the insight to request a disclosure of the survey. This would be valuable in negotiations should they want to lease.
Whatever, perhaps they'll give up spending tons on seismic, just give you a bunch of money to lease and spend millions to drill a very speculative well for you or you could pay your money to do seismic or skip that and just pay millions to drill a well. I'd let you pay me to do seismic on all of mine if you want. Or you could pay me money to do a seismic and then pay me a lot of money to lease and then risk millions of your money to drill a well and pay me more money if it produces no matter if you make money or not. They are putting their money in the pot and you are putting your permission in and the reason they are doing it is to perhaps pay you a lease bonus and royalties, sounds like a pretty good fair deal to me anyway.
My analogy did sound a little spot on as you don't want them to know if anything is there or not before they pay you. I gave those analogies because I bought a house and the didn't want to allow inspection and purchased a motorcycle they didn't want me to check the title history in fear I might find something wrong or negative they just wanted me to go for it and give them money.
"If we could prevent them from doing a 3d they would have to drill to find out what's under there" doesn't sound too good to me sounds like my sellers and I have read the agreement Gateway sent and it doesn't give them permission to do "anything they want", nothing of the sort.
I truly believe the oil and gas should belong to the people of this country, just Wait till they do an eminent domain on you to prove who it really belongs to.
I would guess that more acres are leased without seismic than are leased after seismic. I see nothing wrong with a mineral owner wanting the norm. I'm also pretty sure they will shoot next to you and get the information anyway. I don't care either way. I would be more concerned with the vague entry permit. As I've said before, I've come to the conclusion that it isn't worth binding yourself to ANY contract until it reaches a certain dollar value to make it worth the trouble. I doubt they are paying enough to have an excellent lawyer craft a great addendum to the seismic contract and if the contract the seismic company hands you doesn't address your obvious natural concernes to begin with, you already know what kind of people you are dealing with.
The seismic company may be working for an oil company or it may be a speculative shoot, either way, they are doing it to make money, which isn't a bad thing in itself, but tells me they won't have much interest in making right any extra damages they may do as it would cut into profits. This would bring me back to the vague contract, the need to have my lawyer add an addendum, after which there may be precious little left for me in a BUSINESS DEAL. Why would I subject myself to such a headache and risk for little to no profit by binding myself to a contract?
I've never heard of eminent domain for seismic. Would that mean they would have to drill a well to protect everyones rights even if the seismic looked bad? I thought eminent domain was for things that HAD to happen to protect correlative rights and the public good, I think eminent domain for seismic would be reaching.
My two cents: Years ago, we were approached to have 3D imaging done on our family's ranch. My cousin who was managing the ranch said that if they really wanted to know what was down there, they would pay for a lease. Well, a lot of other ranchers in the area felt the same way.
So, we are all a blank on the survey. We get leases, but no drilling to speak of. I figure they probably know what is down there, but when they go to their financiers, they will not loan money for a fifteen million dollar well without having a complete record with some pretty good indications of a successful well.
As a result, the whole southwest of one county and the southeast of the next county are undrilled. You can continue to play the shell game with the oil companies, or you can go along with the program and maybe make some real money. It is up to you.
Thanks Mr. Gill. I follow your reasoning and think you make a good point. I have just never had a contract that went the way it was supposed to in the area of oil and gas and I really don't need another one that I KNOW going in isn't going to put money in my pocket. It might be different if you have a huge amount of acres but if you have ten acres here and ten over there and twenty somewhere else, likely you will be signing contracts that it would not pay to enforce, which to me is worse than no contract at all.
GXtXTO,