I was never contacted by the oil company that my lease was being drawn into a pooled lease. Was I legally supposed to receive a letter from the oil company to get my permission? This happened two years ago, and I just found out recently. They took my lease and combined it with four others, without my knowing about it.
Secondly, how is a pooled lease decided upon? How are leases chosen to be together?
Thanks for any help. Clint helped me greatly with the access to the RRC website. Thanks, Clint.
Jean, I would say you need to consult your lease as there is probably a pooling clause within it and executing the lease most likely gave the permission the lessee needed.
From what I know of pooling in Texas, it sometimes seems arbitrary. The pool may be larger than necessary to allow for drilling future wells. Of course pooling should always be geology driven. I'm sure someone else has written several paragraphs on the subject. I seem to recall that Buddy Cotten...ah, here it is. No, it wasn't. I will find it though. Lets try this? There are others, just search blog posts. I hope this helps.
Pursuant to the pooling provision in your lease, you probably authorized the Lessee to pool your lease with others when in the judgment of the Lessee, it would be necessary or advisable to do so in order to properly develop the leased premises. In Texas, the choice of which tracts/leases may be pooled for development purposes is generally left to the discretion of the Lessee, subject to the terms of the pooling provisions of the various leases to be pooled (not all leases would necessarily have the exact same pooling provision.)
If your lease contained the usual type of pooling provision, without modification, then you have already granted your consent for them to pool your lease with others when the operator deems it advisable to do so. Under the usual circumstances, no other direct notice would be required, but the filing of a unit designation in the real property records would serve as constructive notice. There are some leases that contain no pooling provision (usually covering a relatively large number of acres), but such leases are usually on custom lease forms. The garden variety Producers 88 almost always has a stock pooling provision, although the particulars can vary widely depending on the version. If your lease contained no pooling provision to begin with (which probably isn't the case), then it would have been necessary for the Lessee to approach you with a request for a pooling agreement that would permit them to pool some portion of your acreage with neighboring tracts for the purpose of forming a unit.
As R. W. Kennedy said, in Texas, which tracts may be pooled together to form a unit can be somewhat arbitrary, but the general intent is to form as large a unit as may be permitted under the field rules for that particular field, while still adhering to the acreage limits as may be set forth in the pooling provisions of the various leases. The field rules are promulgated by the Texas Railroad Commission, and they are supposed to reflect the well spacing and density that will permit the maximum efficient recovery of the resource in place, while protecting the correlative rights of all parties involved. Which rules apply will depend on the field, the product type, the formation and the producing depth.
In Texas, subject to the Lessee conforming to all the applicable field rules and the pooling provisions of the leases involved, the Lessee can combine any leases they may have in the area into a unit, so long as the tracts are all contiguous. The pooled unit may be in the form of a rectangle, but it does not have to be; some pooled units for horizontal wells are highly irregular in shape.
I'm sure I've left something out, which others may be able to supply, but those are the basics.