Hi we are purchasing a home here and in the title paperwork there is listed multiple pipeline easements and oil, gas and mineral leases and all oil, gas and other minerals previously reserved. The property is 2.23 acres and i don’t know anything about any of this, i just don’t want to be purchasing a home to find out someone has the right to come drill on my land or tear up my property, how does this all work?
Well, unfortunately that’s exactly the case. The mineral estate is the dominant estate, meaning the person who owns the minerals has full right to access those minerals, whatever it takes. They have to try to accommodate the surface owner’s use of it, but just “reasonably.”
That said, no one wants an unhappy surface owner if they can avoid it because it can make drilling and producing miserable for everyone involved. You would be paid for any damage to the property (though it’s not required, it is customary). If the mineral estate has the ability to get to their minerals in a way that doesn’t affect your use of the land, they’re supposed to use that method instead. This typically means working with the land owner to come to an agreement (“you can put the well over here as long as you use the road on the back side of the property” or “you can put a tank battery on this side behind the trees, but not this side I’m using for my pool”).
Where is the property? Depending on the state/county, this situation may be unavoidable unless you plan on dropping several thousand for the mineral estate (if the owner would even sell it, and with only 2 acres and existing pipelines the minerals could already leased and you wouldn’t be able to stop it. It might make it more enjoyable to see drilling happen if you get a piece of the pie though). All of your neighbors are likely to be in the same boat.
The downside of modern oil and gas activity is it’s very wide spread and in populated area because of the nature of the large shale plays. You can’t really escape it in some areas unless you live 1-2 hrs away.
The upside is one surface location (a well) can drain 2-3 miles of reservoir, so there’s usually lots of options as to where to put the wellhead. If someone wants to drill, rather than accommodating a hundred different 2-acre surface owners, they can usually find an open, unused are.
Hi thank you for your time and effort, mych appreciated! The property is just outside city limits in Snyder Texas, Scury County.
If you have already negotiated your purchase it may be to late to require but if the owner you are buying the property from is the one who reserved the mineral interest you could request they sign a waiver of surface use.
If the minerals were reserved by a prior owner, which may take some digging in the deed records to determine if the seller doesn’t know, then you could try to get a waiver from that mineral owner. It might cost you something but shouldn’t be nearly as expensive as trying to buy the mineral interest in the two acres you are acquiring.
If the oil leases you see listed as exceptions on the title commitment are still in effect, meaning they are within the primary term of the lease or they are being kept in effect through production occurring on acreage your 2 acres is pooled with (referred to as “held by production”) then the mineral owner couldn’t waive surface use regarding that existing lease but could related to future leases they negotiated that involved your surface acreage. If the leases listed on the title commitment are expired leases, meaning they are beyond the primary lease term and not being held by production, you could get those leases deleted from the title commitment by having your seller sign an affidavit of non-production.
You might also ask the title company if they are willing to add a T-19 endorsement to the title commitment covering your purchase. Too long to explain here, but that endorsement would give you some protection for relatively little additional cost on the owner’s title policy.
Thank you! There are multiple leases listed from the 40’s and early 50’s im guessing they are in production there is what looks like a capped head a 100 yards from the fence line. Think i just have to deal with it at this point just wish it would have been disclosed before i wasnt able to do anything about it.
Also would i ask about t19 or a t19.1 ?
Yes T19.1 is the full name. Here’s a link explaining the cost and coverage https://www.texasnationaltitle.com/article/title-policy-endorsements-what-are-they
It’s possible but no matter how many leases from 40-50’s show up on a title commitment don’t think it’s logical to assume they still producing and in force, and that “capped head” you mentioned being nearby sounds more like a well that’s been plugged and abandoned.
If you want to post an address or legal description of the specific location you are talking about someone should be able to pull up the Railroad Commission’s map showing if there is current production in that area.