Rights of a surrounded tract

Oil and Gas Leasing Help
1

I am the owner of the surface rights and mineral rights of an 86 ac tract in northern Lavaca County.

My property is located one half mile south of the Fayette County line and two miles west of St. John which is on FM957. My neighbors surrounding me have leased to companies two years ago and have given options for two more years beginning in Mar. 2011.

Should production begin on my neighbors land what pooling rules apply in Texas. If the pool is 640ac and the leases surrounding me are less than 640 ac am I automatically included or excluded?

I was one of the parties that leased to Maverick Resources and my draft was not honored so I do not presently have a lease on my property.

Any thoughts would be appreciated.

2

Dear Mr. Maurer,

As an unleased mineral owner, it is very unlikely for your lands to be pooled by the operator. If you are leased, then your lessee will have to agree to and be a part of the pooling declaration. This is typically done when a joint operating agreement is in effect between the parties.

As to the size of the pool and its configuration, its size is what is granted under the oil and gas lease and its configuration is, well…let your imagination be your guide.

Remember that the VAST, supermajority of units in Texas are voluntary units. Voluntary units are created by CONTRACT, the contract being either a community lease, an oil or gas lease that grants pooling authority or execution of a separate pooling agreement.

The short answer is that you cannot be voluntarily pooled in Texas without signing something – a lease allowing pooling, a pooling agreement, or a community lease. Non voluntary pooling primarily comes from a successful Mineral Interest Pooling Act action before the Railroad Commission. In the past 45 years or so, there have been about 100 successful MIPA actions. The burden of proof is on you that you are being drained. You will have to show YOUR seismic, YOUR subsurface interpretation and YOUR estimation of the drainage area from the claimed draining well. If you are not a geophysicist, a geologist and a petroleum engineer, then you have to hire those professionals to act as an expert witness on your behalf.

Best way to get pooled is to grant a lease. If Maverick cold drafted you and filed the lease anyway, perhaps that is why you are not currently leased. Perhaps a trip to Halletsville to see if your lease was filed and if filed, is released, is in order. You always get to go to Novosad’s right off the square for some good BBQ. By the way, I feel as if the courthouse in Halletsville is one of the very best restored Victorian era courthouses in the State.

3

Thanks for your reply. I have intended to check to see if Maverick has filed. If I find they have then some lawyer and I will begin to undo an illegal filing ( don’t know what that will be but I am sure a good lawyer can find some remedy for me, at a fee of course). Thanks again for your reply.

Buddy Cotten said:

Dear Mr. Maurer,

As an unleased mineral owner, it is very unlikely for your lands to be pooled by the operator. If you are leased, then your lessee will have to agree to and be a part of the pooling declaration. This is typically done when a joint operating agreement is in effect between the parties.

As to the size of the pool and its configuration, its size is what is granted under the oil and gas lease and its configuration is, well…let your imagination be your guide.

Remember that the VAST, supermajority of units in Texas are voluntary units. Voluntary units are created by CONTRACT, the contract being either a community lease, an oil or gas lease that grants pooling authority or execution of a separate pooling agreement.

I wrote two short articles on pooling and the history of the law.

The first is here:

http://www.mineralrightsforum.com/profiles/blogs/rule-of-capture-regarding-oil

The second is here:

http://www.mineralrightsforum.com/profiles/blogs/the-basics-of-pooling-and

The short answer is that you cannot be voluntarily pooled in Texas without signing something – a lease allowing pooling, a pooling agreement, or a community lease. Non voluntary pooling primarily comes from a successful Mineral Interest Pooling Act action before the Railroad Commission. In the past 45 years or so, there have been about 100 successful MIPA actions. The burden of proof is on you that you are being drained. You will have to show YOUR seismic, YOUR subsurface interpretation and YOUR estimation of the drainage area from the claimed draining well. If you are not a geophysicist, a geologist and a petroleum engineer, then you have to hire those professionals to act as an expert witness on your behalf.

Best way to get pooled is to grant a lease. If Maverick cold drafted you and filed the lease anyway, perhaps that is why you are not currently leased. Perhaps a trip to Halletsville to see if your lease was filed and if filed, is released, is in order. You always get to go to Novosad’s right off the square for some good BBQ. By the way, I feel as if the courthouse in Halletsville is one of the very best restored Victorian era courthouses in the State.

Good luck,

Buddy Cotten

www.cottenoilproperties.com