Is it necessary to have all parties that have mineral interests in the same tract to agree to the lease before drilling can commence.
Donald:
It is not neccessary for all parties in the same spacing unit agree to lease before drilling begins. If a mineral owner elects not to lease, the operator with controlling interests can drill and the unleased mineral owner will be "forced pooled" whereas they will participate in the well. You can google "forced pooling" on this forum for a futher explaination about what this entails.
Not sure what state you are in, but in Texas the answer is no. There is an Blog article on the Home page that discusses how it works if you do not join in the lease.
Donald:
In California, the short answer is also no, but you would be treated a bit differently. There is no forced pooling in California. You would be considered a joint working interest holder and be entitled to receive accountings of the production. Payment to you, if any, would be on net, not gross, sales and the oil company has the right to recoop its drilling costs as a part of its expenses.
Hope this helps.
Jean M. Pledger
Ehrlich Pledger Law, LLP
info@eplawyers.net
thanks i will review that page
Wade Caldwell said:
Not sure what state you are in, but in Texas the answer is no. There is an Blog article on the Home page that discusses how it works if you do not join in the lease.
I want to lease my inherited mineral rights separately. If I file a Texas Affidvit of Heirship for my percentage of the land will that legally separate ownership and prevent forced pooling?
Stating through an affidavit of heirship that you own some minerals will not prevent force pooling. If you inherited and retain the executive rights to your minerals you can lease to whomever you please.
Helen M Smith said:
I want to lease my inherited mineral rights separately. If I file a Texas Affidvit of Heirship for my percentage of the land will that legally separate ownership and prevent forced pooling?
Helen:
r w is correct that you may lease to whomever. This is somewhat common practice in the world of mineral leasing.
Alabama... anybody know about "forced pooling" and royalties in AL? My understanding is that a person or entity that has mineral rights but has not agreed to a lease will be entitled to a 3/16 share of revenue from any well BEFORE any marketing/operations/ other costs may be deducted. In other words, it's 3/16 of the gross, with all costs being borne by the driller or well owner.
Can somebody confirm or deny this?
Thank you.
Helen,
An affidavit of death and heirship merely declares that you have inherited the mineral interests from your family member. It will not "divide" your mineral rights, in the sense that they are the separate property of each individual owner. Each owner can lease independent of the other owners, and on whatever terms they see fit, without prejudicing the others.
And, there is no forced pooling in Texas.
Helen M Smith said:
I want to lease my inherited mineral rights separately. If I file a Texas Affidvit of Heirship for my percentage of the land will that legally separate ownership and prevent forced pooling?
Andrew,
Thank you, I think I understand now.
Example: 4 people inherited mineral rights on 700 gross acres. One heir can lease the 700 with Z company for 300/20%; one can lease 700 with X company for 350/22%; one with Y company for 325/21%, etc, etc.
Is that correct?
Helen,
You’re exactly right. However, you may consider Negotiating the lease as a group. It’s a good way to share the costs of a good attorney, and in general the larger the amount of mineral rights you control the better yr negotiating position will be.
I think your best bet would be to look up the pertinent state law on forced pooling, it can usually be found online.
Abraham Isaac said:
Alabama... anybody know about "forced pooling" and royalties in AL? My understanding is that a person or entity that has mineral rights but has not agreed to a lease will be entitled to a 3/16 share of revenue from any well BEFORE any marketing/operations/ other costs may be deducted. In other words, it's 3/16 of the gross, with all costs being borne by the driller or well owner.
Can somebody confirm or deny this?
Thank you.
Andrew said:
Helen,
You're exactly right. However, you may consider Negotiating the lease as a group. It's a good way to share the costs of a good attorney, and in general the larger the amount of mineral rights you control the better yr negotiating position will be.
Andrew,
Thank you for your help.
Is this how it goes?
One heir owns 25" of mineral rights; or 185/700 acres, signs a 3 mo. option receives $300 option bonus; his option is purchase by oil company; he receives $300 per acre for 185 net acres = $55,500; then may or may not receive future 20% royalty checks.
How would it work out if all 4 heirs signed together?
Andrew said:
Helen,
You're exactly right. However, you may consider Negotiating the lease as a group. It's a good way to share the costs of a good attorney, and in general the larger the amount of mineral rights you control the better yr negotiating position will be.
It would be broken down the same way for each of them, but someone who controls 700 acres may be able to get a higher bonus per acre or royalty than someone with 185 acres. You would all still have to split the bonus and royalty in accordance with your ownership.
OK, I see it's better for everyone to remain a group if at all possible.
Andrew, thanks so much. :)