If you are a land owner, whose land has oil and gas reserves then you may consider an oil and gas lease. However, signing an oil and gas lease is easier said than done. Oil and gas leases are delicate contracts that differ from standard contracts involving services of experienced Oil and Gas Drilling Company. It is especially difficult to negotiating leases and resolve associated conflicts. An oil and gas lease is a contract that gives rights to extract and market oil and gas from certain piece of land for certain time specifying terms for exploration and production. Such a lease also discusses royalty, a sum paid to land owner for oil and gas production.
Negotiations for oil and gas leases are done by representatives of the oil and gas companies. These officials are often more knowledgeable about delicate issues regarding oil and gas leases than owners are. These issues include mineral right ownership, negotiating leases for exploration and production, researching title status, resolving title issues and utilizing or pooling interests in oil or gas reservoir. Un-informed land owners at a great disadvantage when negotiating on oil and gas without a qualified counselor. If you are a land owner and are considering leasing out your land then you must consult a qualified counselor.
There are many issues that you will need to consider which include royalty, bonus and delay rentals among others. When negotiating royalties you will need to agree upon a royalty rate, method of calculation, payment schedule, reduction in royalties after post-production expenses and bonuses. Doing all of this on your own can be hectic job, while having a counselor by your side will make matters much less complex for you.
As a result of oil and gas extraction, land is often damaged. Therefore, before the lease is agreed upon, you will need to discuss land preservation in order to ensure that minimal damage is done to the land. Other matters that need to be discussed include terms and deadlines, delay rentals, insurance, pooling of interest and assignment of rights.
Imagine having to do all of this on your own. It will take a toll on your nerves and you may end up making decisions that are not entirely beneficial for you. In long run, you may suffer losses at the hands of the extraction company and because you will have signed a legally binding contract there won’t be much that you can do.
For resolution of all these matters you should seek the assistance of a qualified counselor who will inform you about your rights and guide you on the lease. A brilliant counselor will see to it that you gain the most out of signing such a lease, that your land remains undamaged and that you receive payments on time. After all, why should you make not make profits while another company is using your land to make your profits? Do not hesitate, seek advice from a counselor today and make decisions that are beneficial for you.
For more information about Watson Law Firm and our Oil & Gas legal services, Oil & Gas/Mineral Rights