I have recently taken over admin for my family Trust and am wondering what the best way to organize, search, trace leases through the various company buy outs to see what may still be active and with whom I may need to update information.
Welcome to the forum.
What state(s) are you dealing with? Then we can point you in the correct direction.
Do you have a list of tracts or wells to start with?
Similar issue. I have been pulling from the OK County Records website what I believe to be the most current lease agreements and then questioning the operator as to why the decimal interests are different. Just yesterday, I was provided two lease agreements from an operator dated in the early 1960s as being the agreements they claim to be the ones being used to pay royalties. What makes these leases suspect is that the lessor’s names are not on any of the deeds available on the OK County Records website simply because the website only retains information back to the 1990s. However, the lease agreements I believe are applicable, were signed by the lessors/owners that are referenced in the deeds we own. They are second or third generational owners, but the leases were all negotiated in the last 10 yrs. What would be the process to challenge which lease has standings?
Thank you! I am mostly dealing with Texas, maybe some in CO. I do have a list of tracts, and also have a lot of files going back to the 80s with all the different leases over the years. I was hoping there was a shorter way to find out what may still be viable vs contacting each and every one. There are some I know got bought out, and have been trying to start there. It just gets very convoluted quickly. For example, I know Enron is no longer around - but what happened to those leases? Do I contact Youkum Co and see what they have listed with the tracts there? I have owner numbers for some, but not all. Appreciate any insight, slightly overwhelmed at the moment!
For Texas, you can try www.texasfile.com for doing searches of leases. If you have original leases, you may be able to search for the assignments of leases.
It can be tedious, but you will have to work with the TX RRC GIS map and look up every tract and then zoom in to see the wells that cross it. Then use their well search to see who the current operator is. Do you need some screen shots on how to do that?
Are you getting any statements?
In OK, you can use the OCC wellrecords to find the wells in your tracts. The 1073 form will give you the change of operators-mostly.
The county files have “everything” (almost) in paper form, but the online files only go back so far depending upon the county.
The division order decimal is calculated by net acres, actual spacing acres, royalty and percentage of perforations.
For example, 10 acres at 20% royalty with 640 spacing and 50% of the perforations in your section for a multi-section horizontal would be: 10/640 x .20 x .50=0.0015325
if your calculations come up different from the DO, then contact the DO analyst and ask for the exact equation that they are using and a copy of the lease that they are using. In some cases, the spacing is listed as 640 acres, but the actual spacing acreage may be slightly more or less depending upon the curvature of the earth. Sections 1,2,3,4,5,6,7,18,19,30 and 31 are often just a bit different. (Can explain that if you need it) If you have a newer lease in hand, then send it to the DO analyst and ask them why they are not using it. Send correspondence by certified mail return receipt and keep a record of everything that you send.
I found it easier to put files in State, County, township, range section (for OK) or Block, Abstract name and Number, section (for TX). Location is the key. Then you can put leases in the correct file, Division Orders, wells, etc. The location never changes. The operators do!
I have some basic templates for organization if either of you want them. In excel and you can change to fit your needs.
Use your statements if you are getting any. Check www.missingmoney.com in all states where you have acreage. If your statements are on Enverus or other sites such as PakEnergy or MineralAnswers, you will see who the operators are. There is also a free subscription for welldatabase.com that can also be useful.
Martha’s map route is shorter than it looks, and here is why. A Texas lease generally only survives while a well on it, or a unit it is pooled into, is producing. So any lease in the 80s files with no production on that tract today is dead, whoever it was assigned to, and there is nothing to trace. Enron’s oil and gas arm became EOG Resources in 1999, if any of those tracts still produce. Do the files have division orders, or only leases?
Just for clarity, I am past the point of providing the operator with a copy of the lease agreement that appears to be current. They responded by providing a copy of two agreements dated in the 1960’s that they are paying per those terms. The physical property has been sold a few times and the mineral rights sold a few times. Rational wisdom suggests the 1960 lease agreements have expired per the expiration provisions in the agreements (possibly times of no production). Short of hiring an attorney is there a process that requires the operator to prove their 1960 lease agreements are still valid?
Ms. Barnes, i would greatly appreciate a copy of your excel template.
You have the burden to prove the earlier leases expired in all or in part. Many leases from 1960’s (and decades earlier) are still in effect, especially where there are shallow oil wells or gas wells which continue to produce very small volumes and the lease has no depth or trace severance clauses. Start with one lease to review the acreage, depth, and termination language. Then trace production dates for all wells to see if there is a complete break. I have seen acreage where no royalties have ever been paid because the original lease covered an entire ranch and there has been production somewhere at all times. Look at the newer lease to see if the depths are below what is held under the old lease and then look at depth of new wells to see which lease applies.
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thank you, what is Martha’s map? I had wondered about lack of production. I will need to look to see about lease/DO, can I ask what the difference means for today?
Erin
ok wow, a lot to digest, thank you for all the info. I would gladly get all the spreadsheets you are willing to share, and yes could likely use the info on how to zoom in on wells and such. let me know if here is the right venue for that or if you need other contact information. We are on Enverus/Energy Link and I get statements but some of the more detailed ones I’m still learning how to understand. This is quite the process and haven’t had a lot of guidance as I’m taking it over. Is the mineral rights class helpful in these matters? I was planning on taking that at some point.
Going to be a long process to get it all sorted and organized I can see, will baby step it for a time as I get the hang of it all.
Erin
Ms. Barnes, I, too, would love to have a copy of your Excel template for OK properties.
Thanks!
Here are some useful templates to use: Tract list, Well List, Division Order list
_Composite Division Order template.xlsx (10.2 KB) _Composite Well List template.xlsx (10.2 KB) _Composite Master Tract list template.xlsx (57.2 KB)
Thank you so much! Erin
I have a list of 75 leases and it covers 14 Counties in TX, AR, LA, MS, CO states it is overwhelming. my brother never finished the estate so I am trying to track all this down. some money has gone to the State and we are getting that. With some only paying $50 or Zero per yr it is hard to justify all the work to transfer and the cost to file in the County … it is a lot of work. Anyone find an easy way let me know.
It can be overwhelming. Getting them all in order may help heirs down the road if new horizons come into play.