Can anyone tell me if an oil/gas company is required to record a release on an oil and gas lease once production has stopped. My father signed an 80 acre lease with a company back in 1980. There was only one well that produced on this 80 acres and it has since been plugged. The plugging record has been recorded with the Oklahoma Corporation Commission as well. I have someone interested in leasing these mineral interest again and are going to do a title search before hand. They expressed an interest in having a release filed from the previous oil/gas company. I called the company that held the previous lease and requested a release be filed by them. They told me that was a very uncommon thing to do . They do not want to do this and I don't know if it is a big deal or not. The new leasing agent is aware of the plugging report - does he really need a release filed to finalize our current negotiations?
Any information is greatly appreciated!!!
Thank you - Linda
Hi, LInda!
Filing Releases for expired Oil and Gas Leases used to be as normal as leasing itself. Beginning in about the late 1970's to the mid 1980's, however, the companies seem to have all stopped doing so. In part, apparently, because of the expense involved, but I personally think also in part because if there was any way they could come back later and claim that their lease was still active, they could.
It is not unusual to find that there are a number of expired, but un-released leases effecting a tract of land.
The company that wants to lease the land can draw up a Release of Lease for you to send to the prior company to sign. Or even a set of Release of Leases for you to send to all of the prior companies that did not file releases.
But the most common way the companies address such circumstances today is to draw up an Affidavit of Non-Development regarding the old leases that were never drilled and, perhaps, separate Affidavits regarding any leases that were drilled, but for which production has since ceased.
Apparently the idea is to have something filed in the County Clerk's Records regarding the issue. An Affidavit or set of Affidavits have appeared to be just fine for that for many years.
Hope this helps -
Charles Emery Tooke III
Certified Professional Landman
Fort Worth, Texas
Thank you Mr. Tooke. I will contact the new company and see if we can file an Affidavit in lieu of getting the release from the previous company. I sincerely appreciate your input and expertise. It is interesting to learn the history behind some of these ideas and how things have transpired as the years go by.
Merry Christmas to you and your family!!!
Linda