Hi there. I am wondering if anyone has experience leasing the rights to a well they own?
Suggest you post more information about the situation. What do you mean by ‘own’ the well? Are you the operator or partial working interest owner in the well? Do you have plugging liability? Or an unleased mineral owner in a producing well? Or mineral owner receiving or previously receiving royalties? If you bought land with an old plugged or abandoned well, then you are likely not liable for or own the wellbore.
Welcome to the form , Yes , you came to the right forum for help with oil and gas leases, what information are you needing! Please reply, thanks
Hi there. I am the owner/operator with 100% interest in the well. I inherited it from my father. It’s a 30-year-old vertical well. It produced well in its younger days and it’s still producing, but of course, not as well. I have a number of expenses - insurance, well tending, water hauling, maintenance, etc. I think I do have plugging liability.
As the operator, you will have plugging liability. Even for shallow wells, this can amount to $50,000+. Operators usually assign operations and all rights under the related oil and gas leases to a new company under a sale. Value depends on net revenues, liabilities, anticipated well life, and whether you own additional depths under the lease(s) which can be developed. Not sure what you mean about leasing, unless you own some or all of the minerals included in the well and which you want to lease to the new operator. This can be a complex situation and can also be affected by the state and county where the well is located.
Ok, thanks. You answered part of my question. I’m probably not being clear about the situation!