Memo of Oil, Gas and Mineral lease

My siblings and I inherited mineral rights from my father, and have recently received lease offers from an oil co. In researching and going through county clerk records we found a memo to an oil lease that is currently in effect, and set to expire in 2 weeks from the same oil company. The memo we found is regarding the land owner, who may also own some mineral rights, we are still researching this. Shouldn't we as having mineral interests in the land have been included in the first lease? Looking at the tract on the TX RR comm site, I don't think any minerals have been produced, but it shows a horizontal well on the land, as well as a permit.

Ms. Brenner, there can be many complex issues with a well already in place. You may need professional help, meaning it could pay dividends to have professional help if your minerals are drillsite/wellbore tract, how many acres you have and so forth. Your being found just before a well starts producing would start me to thinking of a last ditch effort.

When was the well spud? What is the completion date? Are taxes being paid on production? Is permit for same well or another well? When is it dated?

Dear Mr. Brenner,

The short answer is no. In Texas (LaSalle County) where your property is located, you have no obligation to lease and by the same token, the oil company is under no obligation to make you an offer (except in certain, rare circumstances).

It sure sounds like they have the acreage on the drilling program or schedule. Just because a permit is issued does not mean the property will be drilled. I think (not sure at all) that the drilling permit goes stale in 18 months.

Another real alternative is that the well has been drilled and maybe completed. With the oil shale boom in Texas, it takes a pretty long time for production data to hit the RRC website, especially on horizontal wells. The hole could be drilled and not frac'd for months and months.

Make your best deal and remember that the real money is in the ground.

This happened to me in Cheapside Tx.. My mineral management company discovered a large oil company leased from the surface owner and never contacted me and I owned 50% of the minerals. They had already drilled one chalk well and were producing 150 barrels a day. They were very surprised when we informed them they were trespassing on my minerals. We negotiated a deal and get a check every month.