We have been offered $18,000 compensation for surface damage prior to spudding a well in Canadian County Oklahoma. The site is not being used for agricultural purposes. Does that amount seem fair in comparison to what others have received?
Thanks.
Bill
It depends on what they are getting for the 18,000, how large the temporary and permanent use, whether they are including easements for pipeline and electrical, and whether the easements include the sole right to cross your property. You say the property is not used for agriculture but could it be? Grazing? Future housing development potential?
This surface use could be for decades, would you rent it out for 40 years for $18,000? Would $500 a year be sufficient in year 36 in light of inflation? Would $0 be ok for year 37 and any years after?
You also did not mention if this well was to produce your minerals or offsite drilling to produce someone elses minerals and whether the operator already has the right of ingress and egress?
I would have this surface use agreement on my lawyers desk. I would really want to define what use the land would be put to, temporary and permanent, whether they would park equipment totally unrelated to your well on the property? Do you want your property to become a dump? If any property is stolen, do you want to be responsible for it as they tried to make my friend Virginia?
I would want some protections, such as no junk or equipment parking, the operator would have 30 days after notification to move it or incur a $500 penalty per day after the 30 days notice expires. Just some points to ponder.
Thanks for your reply. The offer also includes $50 per rod for pipe & electrical lines. Any minerals produced would be ours and we have no plans to use the land for any other purpose.
r w kennedy said:
It depends on what they are getting for the 18,000, how large the temporary and permanent use, whether they are including easements for pipeline and electrical, and whether the easements include the sole right to cross your property. You say the property is not used for agriculture but could it be? Grazing? Future housing development potential?
This surface use could be for decades, would you rent it out for 40 years for $18,000? Would $500 a year be sufficient in year 36 in light of inflation? Would $0 be ok for year 37 and any years after?
You also did not mention if this well was to produce your minerals or offsite drilling to produce someone elses minerals and whether the operator already has the right of ingress and egress?
I would have this surface use agreement on my lawyers desk. I would really want to define what use the land would be put to, temporary and permanent, whether they would park equipment totally unrelated to your well on the property? Do you want your property to become a dump? If any property is stolen, do you want to be responsible for it as they tried to make my friend Virginia?
I would want some protections, such as no junk or equipment parking, the operator would have 30 days after notification to move it or incur a $500 penalty per day after the 30 days notice expires. Just some points to ponder.
What RWK said was an absolute. You best run as fast as you can to the best attorney you can find before you pull the trigger on this one!
Bill Walker said:
Thanks for your reply. The offer also includes $50 per rod for pipe & electrical lines. Any minerals produced would be ours and we have no plans to use the land for any other purpose.
r w kennedy said:It depends on what they are getting for the 18,000, how large the temporary and permanent use, whether they are including easements for pipeline and electrical, and whether the easements include the sole right to cross your property. You say the property is not used for agriculture but could it be? Grazing? Future housing development potential?
This surface use could be for decades, would you rent it out for 40 years for $18,000? Would $500 a year be sufficient in year 36 in light of inflation? Would $0 be ok for year 37 and any years after?
You also did not mention if this well was to produce your minerals or offsite drilling to produce someone elses minerals and whether the operator already has the right of ingress and egress?
I would have this surface use agreement on my lawyers desk. I would really want to define what use the land would be put to, temporary and permanent, whether they would park equipment totally unrelated to your well on the property? Do you want your property to become a dump? If any property is stolen, do you want to be responsible for it as they tried to make my friend Virginia?
I would want some protections, such as no junk or equipment parking, the operator would have 30 days after notification to move it or incur a $500 penalty per day after the 30 days notice expires. Just some points to ponder.
Bill, the current well is yours, are you absolutely certain that they will not drill another well to drain someone elses minerals from the pad on your surface?
$50 per rod sounds bargain basement. Use the search function at the top right of this page for pipeline easement and see what comes up, double to triple the $50 in most cases.
I would generally be ok with electrical easement as long as it follows the property line and neatly makes a right angle to the wellpad, as long as it has nothing to do with sole right to cross your property.
You did not mention if they were seeking sole right to cross your property, I would want it spelled out that you are not granting sole right to cross.
Unless you are immortal, you might want to leave some wiggle room for your decendants and even if you are immortal, plans change over a period of decades.
You do need some protections, you might check out Buddy Cottens site, I believe he has a surface use contract at a reasonable price that your lawyer could mine for the reasonable protections applicable to your situation. Remember that it is too late to add anything after the fact, you are only entitled to what is spelled out in the agreement. Does your agreement even spell out how the site is to be recovered after the use has ended? After use ends, will you as the surface owner be responsible for clean up and remediation? Will the state come in and fine the living heck out of you for toxic cleanup for all the little spills that occurred unreported over the years, because you are the owner? You have alot more at stake here than $18,000. I hope you get some help.
Bill Walker said:
Thanks for your reply. The offer also includes $50 per rod for pipe & electrical lines. Any minerals produced would be ours and we have no plans to use the land for any other purpose.
I found this website with a checklist for surface and damage use. It seems to cover much of what is suggested above==- http://www.powderriverbasin.org/surface-and-damage-use-agreement-sa...
However, I am also trying to figure out a surface use agreement and the compensation amount. Plus, how do you find a good lawyer? How much should a lawyer charge? My property is in West Texas though.