I have a primary lease which states that I am to be paid monthly. A well went into production (was hooked up to natural gas line and being sold) Oct 16, 2013. I have received no money or compensation as of the expiration of the primary lease on Jan 24, 2014. In Feb I received a check which I have not cashed. It’s not much. Was the primary lease still in effect as of Jan 25, 2014?
Please advise of the status of the lease.
A lease on your acreage is in force as long as production is happening. Royalties are to be paid on all production according to the terms of the original Oil and Gas lease. Companies must report their production to the State where the well is located upon sale. You own the minerals in the drilling unit, not the exploration company, you convey working interest to them through the lease in order for them to drill and complete a well if the geology is viable for that. The following factors apply: Rate of royalty in the lease, amount of acreage you own in the drilling unit, drilling unit size by type of formation (varies according to well and formation type), and amount of monthly production. Call the company, Texas operators are easiest of all to talk to.
Dear Mr. Dallas,
A lease is in full force and effect unless terminated by the provisions of the lease itself. Production is only one of the several things that can extend the lease past its primary term. Without seeing all the information, nobody can make a determination as to its status.
An oil and gas lease (in Oklahoma where your property is located and in Texas and other states) is a conveyance of the mineral rights to the lessee with the lessor reserving a royalty interest and having a possibility of reverter. The working interest is created by the oil and gas lease. It is not an element that you are conveying. By granting an oil and gas lease you are conveying your minerals in the nature of a determinable fee.
Best
Buddy Cotten
Lease term: my lease term did have the $1 an royalty acre during shut-in which they did not pay either. I have been told both the lease is still in effect and that the lease became broke at which time the oil company was selling gas and oil without paying me monthly. Any good mineral owner lawyer advice send email d4dusty@gmail.com
I would recommend John McFarland in Austin.