They are wanting to spread drilling mud on our property. We currently rent the property on a Crop-Share basis (1/3 lessor - 2/3 - lessee). What is the typical split for the payment of the drilling mud.
Does 100% of the payment go to the lessee if it is a cash rent lease?
Darrin:
In the majority of the cases I have dealt with in regards to the spreading of drilling mud on properties, the surface owner requests this mud be spread for fertilizer purposes and no money is paid to the surface owner. The operator is required to disk the mud to deter any migration from the site and to protect any waterways on the property. I am only familiar with this in the East Texas.
In Louisiana the practice is common to pay the surface owner in order to spread mud on the land. This is logical since the operator would otherwise have to pay to haul it off. As long as the disposal of the mud does not damage the crops of the surface lessor, I would think the surface owner is entitled to any payment.
Are you referring to ‘land farming’? I believe that is what they called it when they approached us. They should definitiey pay as they would have to pay much more to have it hauled off. Also, there are byproducts that are deemed un-environmentally friendly. Due to greater restrictions, they paid us 3x as much the second time around. $3000 vs. $1000.
Dear Ms.Ezell,
That is exactly what landfarming is. The fluids are thin spread and treated with microbes to eat the bad stuff up and then disked up.
HOWEVER, there is sometimes a problem with NORM (Naturally Occurring Radioactive Materials). Ensure that any agreement will keep the field from glowing green at night.
Can you tell me what the current rate is for this per acre?
Can you tell me what you received for compensation per acre?