Our family is currently filing a couple of Oklahoma probates to ensure marketable title on mineral acres and have been told this will take about 90 days. If our mineral leasing goes to force pooling before the probates are final, how would the yet unmarketable fractional shares be handled in the force pooling process? Would they distribute to family members indicated in Affidavits of Death, Heirship, Etc., which have not yet been on file for 10 years? Or would they automatically be assigned the lowest bonus/royalty offering by the judge? We believe the probates will be finalized prior to drilling and paying royalties.
We were very close to having agreed upon lease terms, but have just now received certified letters asking us to select from 6 different options regarding participation or lease/assign options. We are hesitant to do this without seeing a lease and presume it will go to force pooling. Are there steps that we should take to protect our interests and prove that there are not “unknown” heirs but rather an active estate?
Since you are not the record owner, then you are in a precarious position. If the probate has been start and an executor has been recognized by the Court, then you can potentially act on behalf of the estate. Contact the attorney handling the probate and get advice as to the powers and limitations of the executor prior to entering into any agreement.
Oil and gas mineral interests are a type of real property. A doctrine of real property law is that all real property must be owned by some alive person at all times. Therefore, when your ancestor(s) died, the property became vested (owned) by the heirs. So, this interest is owned by you and your other heirs, subject to the probate.
As a result, you or the other heirs can make an election. I would suggest that if all of you agree, all the heirs and the personal representative should make an election.
Now, one thing is certain, if you don’t make an election, if will end up being the default election which is the lowest royalty/highest bonus.
When the pooling order is issued, in the words of the Dennis Hopper character in Hoosiers, don’t get caught watching the paint dry. All respondents have a limited time to make an election.
Thank you both for your information. We have Affidavits on file, some of which are 10+ years and want to clear up any potential issues with the probates. Does all of the title work have to be completed prior to forced pooling?
Tim is the best guy on this forum for advice. Ill add on a little. It seems your interest is under comments and requirements, its good that that they reached out to you and your interest isnt listed as unknown heirs. You most certainly need to elect an option before the due date. They will do a final division order title opinion when the well is drilled for payment purposes. If your timeline doesnt fall within that window, you will need to supply them with the filed doccuments for an amended division order title opinion to get into pay. In short, reach out to the operator/landman overseeing your well/section/minerals to get the dialogue going as soon as you can, 85% of them are very helpful and easy to work with.
Notice:Informational only. No attorney-client relationship is formed by this post. I am an Oklahoma-licensed attorney, but this is not legal advice. Do not share confidential facts in this public space.
The certified letter which we’ve received is not a pooling order but appears to be a last effort to get mineral owners to select a signing bonus and royalty prior to pooling. There is no due date in this letter but does say that the company expects a forced pooling in the near future. We are reluctant to sign/return this letter because it does not offer the signing bonus/royalty option which the company offered during lease negotiations.
Well, that changes everything. The advice given was based on the assumption that you were under a pooling order. Ive been doing this for 50ish years and have never had an operator say, you are about to be under a pooling order, lease now or you will be force pooled in the near future. It sounds like theres way more to this story and your main gripe is about the offfer that you previously had, went down in value and now wondering if you could get the same offer if your minerals are pooled?
Bob, under the rules (or at least custom), any company applying for a pooling has to be able to testify that they sent out proposal letters within a specified time (not sure what it is) prior to the pooling action.So, what 247JT received was a pre-pooling letter, requesting a lease or if they want to participate.
Yes, Mr. Dowd and Bob77 – both correct. This appears to meet their legal obligation to say they have negotiated. After 6 months of negotiations, we and about a dozen other family members were ready to sign a lease which would be offered to each of us, and the landman said he would be sending the lease…and then came the certified letter. Should we sign and return this letter, or ask for the same signing bonus offered in our negotiations, or just wait for pooling? It has been a difficult procedure for us.
You can respond to the letter asking for the a lease and the terms you want. Now, very important to anyone who reads this, if you get a letter asking you to lease at certain terms at 3/16, 1/5 or whatever and then you get pooled. The response to the letter is not an election under the pooling order. If you are pooled, you still have to make an election under the pooling order. A response is not an election. strong text
Sounds like this is in Oklahoma. The pre-pooling letter comes out a few weeks before the pooling case is posted with a projected hearing date. Once the pooling hearing has been completed, a pooling order will come out. The respondents have 20 calendar days from the official date listed in the order in which to answer the pooling. Most of us would pick the highest royalty and send the pooling response by certified mail return receipt (to provide a paper trail) before the 20 days. I never respond to the pre-pooling letter, just the pooling as it is the response that counts.