Clarification on what my deed says

Landman Discussion
1

I recently started receiving tax bills for the interest on the wells on my property. We bought the property 6 years ago and have never received anything as the property was under a lease that was signed by the previous owner who passed away a few months before we bought it. I called the tax assessor and was told that if the mineral interests were not mine I would not be receiving these bills and that there was nothing they could do and I should call the mineral company. Well, I did and that could take 8 weeks and the taxes are due this month. This is what my deed says.

Reservations from Conveyance: None

Exceptions to conveyance and Warranty:

This conveyance is made and accepted subject to the following matters, to the extent the same are in effect at the date of this instrument, relating to the hereinabove described property: Restrictions of record, if any; Reservations of mineral and/or royalty interests of record, if any; Terms, conditions, and stipulations contained in any Oil, Gas, and Mineral Leases, if any; Easements and setbacks of record, if any; and to all zoning laws, regulations and/or ordinances of municipal and/or other Exceptions to Conveyance and Warranty.

We have received no royalties for this property, so my question is do you think we should pay the mineral taxes?

2

Because there were no reservations in the deed any and all mineral interest the previous owner owned transfers to you. You need to send a copy of your deed to the operator of the well(s) and have them make a change of ownership so you can be placed in pay to start receiving your royalties. If you don’t pay the taxes the mineral interest will be put up for auction and sold. The taxes are only a small portion of the revenue you should be receiving so you’ll want to pay them. The county can tell you who the operator is and their contact information.

3

Thank you so much for your help. This is good news and I will go ahead and pay my taxes. I did some checking and the 6 wells on my property have been making a lot of money over the last few years and I wonder where that money has gone and who paid the taxes.

Mineral Joe said:

Because there were no reservations in the deed any and all mineral interest the previous owner owned transfers to you. You need to send a copy of your deed to the operator of the well(s) and have them make a change of ownership so you can be placed in pay to start receiving your royalties. If you don’t pay the taxes the mineral interest will be put up for auction and sold. The taxes are only a small portion of the revenue you should be receiving so you’ll want to pay them. The county can tell you who the operator is and their contact information.

4

Lori,

I would contact the oil company first to verify everything before you pay the taxes. Just call the oil company or operator and tell them the situation and send them a copy of the deed (by fax is quicker) to make certain the previous owner did own mineral interest (now your interest, if any). The previous owner may have not owned 100% of the mineral interest. If the operator has not been sent a change of ownership they will keep paying who they have on record as it is your responsibility to inform them. If they cannot pay the owner they show of record then it will be paid to the state in the name of the owner the operator has on their records.

5

Thank you Tim

It took me almost two weeks to get through to the people at Chesapeake and finally when I did they told me to send them a copy of the deed which I did two days ago and was told it was sent to the proper department and it would take 6-8 weeks before I hear anything and the taxes are due on the 31st and just wanted to make sure I won’t get into any kind of trouble for not paying them in time.

Also when I talked to the operator she said it showed that the previous owner has leased out the mineral rights which has now ended, so all the money that shows under his name will I be able to recover this?

6

Lori Cervantez said:

Thank you Tim

It took me almost two weeks to get through to the people at Chesapeake and finally when I did they told me to send them a copy of the deed which I did two days ago and was told it was sent to the proper department and it would take 6-8 weeks before I hear anything and the taxes are due on the 31st and just wanted to make sure I won’t get into any kind of trouble for not paying them in time.

Also when I talked to the operator she said it showed that the previous owner has leased out the mineral rights which has now ended, so all the money that shows under his name will I be able to recover this?

7

If the money has not been paid out you should receive payments back to the date of the deed. You state now ended, are you being taxed on a Chesapeake well or what do you mean by ended?

8

I think the operator said that the lease recently ended but I am not sure.

9

I am being taxed for mineral interest for the wells which were leased by the previous owner in 2005 and we bought the property in 2006 from the Independent Administrator of the Estate which was his son and the tax amount comes out to about 200 dollars for all six wells, but what I do not understand is who has been paying the mineral taxes for the previous years, because this is the first year we have received tax bills for the mineral interest.

10

The county is trying to tax you for a producing well, not an expired lease. How many acres do you own or is it less than an acre and what county?

11

It is one acre and it is in Tarrant County (EDITED by ADMIN - I added the new discussion you started on the same topic below:)

I recently started receiving tax bills for the interest on the wells on my property. We bought the property 6 years ago and have never received anything as the property was under a lease that was signed by the previous owner who passed away a few months before we bought it. I called the tax assessor and was told that if the mineral interests were not mine I would not be receiving these bills and that there was nothing they could do and I should call the mineral company. Well, I did and that could take 8 weeks and the taxes are due this month. This is what my deed says.

Reservations from Conveyance: None

Exceptions to conveyance and Warranty:

This conveyance is made and accepted subject to the following matters, to the extent the same are in effect at the date of this instrument, relating to the hereinabove described property: Restrictions of record, if any; Reservations of mineral and or royalty interests of record, and to if any; Terms, conditions, and stipulations contained in any Oil, Gas, and Mineral Leases, if any; Easements and setbacks of record, if any, and to all zoning laws, regulations and or ordinances of municipal and/or other governmental authorities, if any.

Grantor, for the consideration and subject to the reservations from Conveyance and the exceptions to conveyance and warranty, grants, sells and conveys to Grantee the property, together with all and singular the rights and appurtenances thereto in any way belonging, to have and to hold it to Grantee and Grantee’s Heirs, successors, and assigns forever. Grantor binds property to Grantee and Grantee’s heirs, successors, and assigns against every person whomsoever lawfully claiming or to claim the same or any part thereof, except as to the reservations from conveyance and the exceptions to conveyance and warranty.

Does this mean we own the mineral rights and should pay the taxes on the mineral interest?

Grantor, for the consideration and subject to the reservations from Conveyance and the exceptions to conveyance and warranty, grants, sells and conveys to Grantee the property, together with all and singular the rights and appurtenances thereto in any way belonging, to have and to hold it to Grantee and Grantee’s Heirs, successors, and assigns forever. Grantor binds property to Grantee and Grantee’s heirs, successors, and assigns against every person whomsoever lawfully claiming or to claim the same or any part thereof, except as to the reservations from conveyance and the exceptions to conveyance and warranty.

HERE IS THE REST OF THE WORDING FOR SOME REASON IT DID NOT ALL UPLOAD

12

OK.

You bought some property that was subject to an oil and gas lease. It is the DUTY of the new owner (you) to notify the oil company of a change of ownership. That is in the lease form that your deed was subject to, so it was your duty.

The previous owner received the royalty since the company was not notified. Since they were not notified, the CAD was not notified.

Apparently, (really guessing), the royalty checks were returned and a landman took a quick look at title and suspended the funds, pending you following the lease terms.

Before you get too upset with the oil company, Lori, it was your job to follow through. The oil company cannot run title every month or so on every producing tract they have to see if any changes have occurred.

The lesson to be learned is that the minerals are yours and they will not manage themselves. It is your duty to you and your future generations to take care of your business.

13

The problem is we did not know we owned the mineral rights until last month when we started receiving tax bills, so Buddy do you think we will be able to get all the money back for the last few years which is quite a lot judging by the 5 year history on file with the taxes?

Buddy Cotten said:

OK.

You bought some property that was subject to an oil and gas lease. It is the DUTY of the new owner (you) to notify the oil company of a change of ownership. That is in the lease form that your deed was subject to, so it was your duty.

The previous owner received the royalty since the company was not notified. Since they were not notified, the CAD was not notified.

Apparently, (really guessing), is the royalty checks were returned and a landman took a quick look at title and suspended the funds, pending you following the lease terms.

Before you get too upset with the oil company, Lori, it was your job to follow through. The oil company cannot run title every month or so on every producing tract they have to see if any changes have occurred.

The lesson to be learned is that the minerals are yours and they will not manage themselves. It is your duty to you and your future generations to take care of your business.

Best,

Buddy Cotten

Mineral Manager

14

Mineral rights is something one needs to ask about before closing, when buying property.

15

Yes, ask about it before closing, but don’t necessarily believe what you hear. When I bought my house, I inquired about minerals and mineral rights. I was told, and the listing stated, that no minerals or mineral rights conveyed. So when a CHK landman approached me for a lease years later, I told him to double-check his Title Runsheet because I was told that I owned no minerals. He said that I did, I took a day to confirm that he was right, and the Realtors who sold me the property obviously were uninformed, lazy, or clueless. They probably just put “No” on the listing, meaning that I got no minerals, because they did not want to have to figure out if I did or not, they just wanted my signature.