I would like the advice of a Professional here? My family signed a Relinquishment contract with a small company however owned by a larger oil company. The Relinquishment contract is treated as a PSL Contract with one more stipulation. That the Operator has to plant the first hole before the 1st day a year later, as in our contract he was to have drilled the first hole on or before March 1st. 2020. I saw that they did get the permit almost 6 months in advance of the drilling date of March 1st, but never even moved the drilling rig in on the property. I called my Company that leased the minerals, they just said they will drill the hole when they get around to it. Surely since the State wrote that contract, they must have a penalty for the Oil Company, or does the virus earn them a PASS. On 750 Lease.
I am not a professional, but since you have yet to receive a reply, I will offer my two cents anyway. If the lease had to be approved by the State of Texas’ General Land Office, you might contact that agency and speak with someone in the leasing area of its Energy/Oil and Gas division to try to learn more. Is the language of your lease so broadly written regarding what constitutes drilling that site preparation alone might meet the drilling obligation?
I think you may be mixing 2 separate legal documents here. Certain surface owners act as agents for the State of Texas and execute an oil and gas lease using the Relinquishment Act Lease (RAL form) found on GLO website. These are tracts where the State owns 100% of minerals and where the surface was sold by the State during specific years. This is a 3 year oil and gas lease and the State receives 1/2 of royalties and the owners of the soil receive 1/2 of royalties. Separately, the GLO will settle with the operator on a Pooling Agreement setting out the terms of participation of the leased minerals in a unit or a shaving well or an allocation well. The GLO is slow to upload the Pooling Agreements to its website and you can either find a copy recorded in the county deed records or ask the operator or GLO to email a signed copy to you. It is possible that the Pooling Agreement has been amended or it may have expired. Also, in May, the GLO adopted a policy of extending 2020 drilling requirements to 2021 due to the extreme drop in oil prices. You can find this information on the GLO website. Even if the Pooling Agreement has expired, that will not terminate your RAL lease if it is in its primary term. Pull out your RAL lease and the Pooling Agreement and read all the terms carefully. If you post specific information about the lease, legal description, operator and well name and API number, someone will be able to give you more explicit information and direction to research your situation.
This topic was automatically closed after 90 days. New replies are no longer allowed.