I purchased a commercial property a year ago, I know we do not own the minerals but I was just contacted by a drilling company that they are looking to build a pad on our property. I have no idea about the surface rights, never really thought that we would not own them, is it possible to purchase a property and not have that appear in the title search?
Yes, it’s possible you do not have surface control. You didn’t say which state this property is located in. It may not be true in all states but in Texas the mineral interest is superior to the surface interest. Each state has a governing body, in Texas the Railroad Commission, that establishes basic rules that companies must follow in locating drill sites.
If the mineral interest in your property had been retained by someone further back in the chain of title then the party you bought from couldn’t have transferred surface control to you because they didn’t have it themselves. Unless it is a very small piece of land, determining the status of surface control always needs to be part of the due diligence that’s done before someone buys property. If the full mineral interest isn’t going to be included in the sale the buyer should negotiate provision in the purchase contract requiring waivers of surface use be provided by the seller as part of their deed if they own the minerals, or that the seller obtain the waivers from whoever holds the mineral interest. Title commitments often include exceptions stating the title to the mineral interest hasn’t investigated and isn’t part of the title guarantee.
At this point I’d try to find out who owns the mineral interest and try to determine if their lease includes any provisions that restrict the size or location of drill sites or other surface facilities. See if the drilling company will tell you who they leased the land from.
Although they aren’t required to do anything beyond what the state rules require, drilling companies generally want to keep the surface owner happy and wil try to work with them as long as it doesn’t prevent, or significantly increase the cost, of drilling their well Your alternative may be negotiating with them regarding a size and location for the pad that will have the least negative impact on your property.
As mentioned VERY possible.
Title searches are just that - a review of who holds title to the property - that is the right to convey it to another if they choose.
It does not mean the researcher guarantees any and all questions that may ever be asked will be covered and answered 100%. It MAY mean this issue was covered - if requested and performed, but if not requested - then it likely was not performed.
There are basic “guidelines” that vary by state as to easements/building requirements for a well pad - and the group building a pad may well opt to compensate the landowner to avoid any issues or delays. But just as a “right of way” may have been granted by the former owner to give access to a pipeline, power line or roadway to access the property - they may have also granted this to someone to develop minerals on the property. Its the buyers job to ask these questions and their title agent to ask/confirm. The title search is performed for benefit of the purchaser - not the seller, so it is on the buyer of a property if they did not ask for/receive full information. Only if it was not properly disclosed or deeded is the seller on the hook here.
You may be entitled to surface damages.
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