Geophysical Operations Request

General Mineral Rights Discussion
1

I just received a request to conduct a 3-D survey in four different sections of two different OK counties where I own mineral interests, not surface rights. While I know it may lead to positive future gains, I wonder if the request is a back door entrance that could tie up my interests. It reads:

(Company), LLC (hereafter called "Contractor") and/or its assigns, hereby respectfully requests your permission to conduct a geophysical survey (3-D type operation) for a term of 2 years from the date first mention above, including the right of ingress, egress, and across the mineral interests owned or leased by you (hereinafter call the Lands) more fully described below:

(...4 sections in two different OK counties I left out)

If at the expiration of the 2 year term provided for herein, Contractor is permitting, surveying, or conducting seismic operations with the Canadian Valley 3-D Survey then this Permit shall continue and be in force for as long thereafter as is necessary to complete all permitting and geophysical operations of whatsoever nature. Contractors's operations on the Lands will be conducted, in accordance with standard industry practice and in a prudent and careful manner. Contractor agrees to indemnify and hold you harmless from all liability and claims, if any that my result from the operations conducted under this Permit. This Permit is subject to any existing valid oil and gas lease covering the lands herein and shall include the mineral and leasehold interests owned by you lying within the boundaries of this survey, portions of Townships 5N-13N , Ranges 3E-9E, which we may not be aware of at this time or are not fully described herein.

Any thoughts or recommendations out there?

Thanks-Arthur

2

Arthur,

The seismic Survey is planned over a large area and I would think that it will be to the mineral owners and lessee's advantage as it may be enough for one or more wells to be drilled in the area. If you decide to cooperate by granting your permission, don't expand on your rights either implied or stated by the permitee. In other words, only grant permission to explore your minerals by geophysical operations that are within your present rights to do so. If you don't have the rights now, you won't have to create them or buy them back. If you have granted a lease, you may have assigned your rights to explore exclusively already. Don't promise something you don't have and make the geophysical company determine what your rights are for their purposes.

Have you lawyer simplify the contract and add a narrow scope of work to be permitted as well stating that there is a time limit and that no rights to mineral production are included by through or under you. If they are offering money in exchange for permission to extract geophysical data, multiply your suspicions by 10. If you have a lot of acreage in the block, ask for free access to the data after 5 years at your expense, of course.

3

Gary,

Thanks for your input and I appreciate your advice,

Arthur