Unfortunately, my mother has a lease that was signed quite a few years ago with Jay-Bee that has not been drilled as of yet. Jay-Bee reliably pays her $30 every year to maintain the lease status. What happens at the point where my mother passes away? She has 4 heirs. Will Jay-Bee still continue that lease with an annual payment of $7.50 to each heir? or some other method. I’m pretty sure the lease doesn’t end upon death, so I assume Jay-Bee has to do something after we notify them of death.
I can pretty much guarantee you that the lease will continue indefinitely no matter what happens. They will definitely send you a $7.50 check to just hold onto the lease. Where at in Tyler County is the property located at? From my experience I thought that leases were only good for 3-5 years depending on what the actual wording in the lease says.
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The property is located in the far eastern tip of Tyler County along the border with Doddridge County.
I re-read the lease just now and the initial term was 3 years, with extensions when there is operations taking place. I decided to reach out to my attorney on the matter for some guidance, as I don’t think there is significant operations taking place on the property. I’ll update if things change.
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@cliffdiver62 are you collecting royalties from a shallow well? Very rarely do you get annual lease bonuses of only $30. Usually its an initial bonus and a renewal bonus, after which your lease expires.
But yes if something happens to your mother then it will be divided into the number of heirs. Make sure her estate is clear as we’ve seen a lot of issues with people who do not have clear probate on their Oil & Gas interests
It is not a lease bonus. It is not royalties either. It is a fixed delay rental payment of $30 that is being paid every year to my mother. The lease contains wording related to this payment indicating that the lease shall remain in effect as long as the payment is made every year. However, there are various stipulations and caveats in the wording. It is unclear to me how long they can continue this. I am currently working with my attorney to decipher the wording to see what my options are. This lease was signed in 2009 by my parents with no attorney review on our side, so it is likely a one-sided lease.
Very interesting. I didnt think you could have an indefinite lease unless there was production, but I’m not an attorney. Please share what ends up happening