At the outset, let me say this is going to an attorney for review and their advice. We haven’t all yet received the documents, me included. But here is what they are asking us to do:
“For adequate consideration, the receipt and sufficiency of which is acknowledged, the undersigned agrees to, ratifies ,and confirms the terms of the Lease and the Unit designation and agrees that the Lease is subject to all of the terms and provisions of the unit designation. This ratification is executed for the express purpose of allowing the lease to be pooled in the same manner and on the same terms and basis as provided for in the Unit designation. This ratification is executed as of the date of acknowledgement of the signature below, but shall be effective as of the date of first production .”
Do you get a sense of what they are really asking? The language would lead me to think that by our signing this ratification, we would in effect be renewing or reviving our lease of the year 2000. And how on earth would that ever be to our advantage? Just why do they need our help making this pooling retroactive to the date of first production when the well is about done? Isn’t it a little late to worry about all these issues now? Unless, as it appears in the lease this was to be done in writing and put of record in the county within the primary term which in our case was 3 years.
Any thoughts on what they might be up to in asking this of us? Remember, this is the first time we’ve heard from anyone in Texas in 14 years. Hmmm
In some form or fashion our answers will be coming shortly. This is our last piece of the puzzle. Why? 14 years they ignored us and now they want us to reaffirm an old lease? We will see…
The form you receive may give more clues but I don't think it will provide the answer to the driving force behind this pooling ratification. That is one question they will never give you a straight answer to. I think that if it really was a good thing, like a well to be drilled draining both pools, they would be more than happy to tell you.
I do recommend that you never sign anything that starts out with a lie, such as, "For adequate consideration...." when they want you to do it for free. Ask them to send you paperwork that does not make you a liar if you sign it.
There is clearly a reason that although we make this ratification today many years later, the requirement be met “but shall be effective as of the date of first production”. That would take it back to sometime in 2001 I believe.
It’s obviously important we agree to take it back to that date. Maybe their hands are tied with regard to any future exploration (drilling permit) involving these leased / pooled acres until they legally have this Unit of record (which may be where we come in). Just a thought.
Or as it’s been suggested “their taking their eye off the ball” may have cost them much more.
Hey, Tony -
A "Unit Designation" in Texas is where they are pooling a number of older wells together to form a secondary recovery project such as a Waterflood or a CO2 project.
Does it include present words of grant, such as "...the undersigned does hereby lease and let said lands..."
If you will send me the legal description of the land(s) I will see what is happening on the ground. It might be that a well was drilled back in 2000 - 2003 that they want to reopen or re-enter and include in their secondary recovery project.
If you want to send me the legal privately, accept my invitation to become A Friend on The Forum and send it to me that way.
Hope this helps -
Charles
Charles Emery Tooke III
Certified Professional Landman
Fort Worth, Texas