Anyone sign up for the Marcelus Gas? (Utica: lease, deed)

[Hopes]

Originally Posted by h_curtis

Good luck with that though. Just because someone is an attorney, doesn't mean they know more than some bum in a bar. Many haven't a clue about much and the ones that do are hired by corporate.

That's an excellent point inspired by UKyanks argument that Pennsylvanian's aren't experienced in gas contracts.

[UKyank]

Originally Posted by Hopes

That's an excellent point inspired by UKyanks argument that Pennsylvanian's aren't experienced in gas contracts.

I agree... I would look towards texas with their greater years of barnett shale experience for information. I think pennsylvanians now are improving in this area, but unfortunately the big rush to sign up land owners by the various gas companies when marcellus initially came into the region lit up people's eyes with their big per acre signing bonus offers and they were eager to sign on the dotted line to their detriment in regards to the rest of the contract. Coupled with the big rush of attorneys around here claiming knowledge in this area to make a buck when in fact they didn't really have any specialized knowledge put many people in a lot worse off positions then they should have been in concerning their land.

[BrianTH]

The companies all have experienced attorneys. The bigger rightsholders and ownership groups all have experienced attorneys. There is typically quite a bit of complex negotiation on terms before such parties sign a contract.

In addition to the complexity of the issues, there is also the basic point that typically you should have a neutral party giving you advice in these matters. That is why even lawyers hire other lawyers when dealing with complex matters (as the saying goes, a lawyer who represents himself has a fool for a client).

Of course if you do hire a lawyer, you should get one with actual experience in the field (and I agree that you shouldn't be looking for someone with an otherwise very local practice, unless you are dead sure they have been working on gas leases since before the Marcellus boom).

[rugerjitsu]

Originally Posted by Hopes

My SIL has a contract. She's had it for a few years. The gas company paid her a large payment at signing the contract and she also receives a substantial monthly payment. The drilling isn't even going to happen on her property. The drilling will happen on a neighbor's property. Her property is simply one of a large group of surrounding properties. She has been receiving monthly payments for over 2 years and they haven't started drilling yet. Even if they never get around to drilling, she'll still receive the payments. Not sure if her deal includes a royalty later, but it's a good bet that it does. She didn't use a lawyer. Not sure if her neighbors consulted a lawyer and she used the advice they relayed to her. Oh, I remember one more thing. Her contract includes environmental cleanup and restitution if the water supply gets trashed.

hopes, you know i'm in the oil and gas business...in the land department, and i handle leasing. i'm curious what these "monthly payments" are for if they haven't drilled yet...if she rec'd an upfront bonus payment, the lease is termed a "paid up lease", which means there won't be anymore payments unless it's royalties, damage settlements, etc. and btw, all oil & gas leases will include a royalty % to be paid out if that particular lease is included in a producing unit.

you think you could find out what the monthly payments are for??

[Hopes]

Originally Posted by rugerjitsu

hopes, you know i'm in the oil and gas business...in the land department, and i handle leasing. i'm curious what these "monthly payments" are for if they haven't drilled yet...if she rec'd an upfront bonus payment, the lease is termed a "paid up lease", which means there won't be anymore payments unless it's royalties, damage settlements, etc. and btw, all oil & gas leases will include a royalty % to be paid out if that particular lease is included in a producing unit.

you think you could find out what the monthly payments are for??

I've only heard details via hubby. I'll call her directly to ask specifics and let you know.

[theo2]

Originally Posted by rugerjitsu

hopes, you know i'm in the oil and gas business...in the land department, and i handle leasing. i'm curious what these "monthly payments" are for if they haven't drilled yet...if she rec'd an upfront bonus payment, the lease is termed a "paid up lease", which means there won't be anymore payments unless it's royalties, damage settlements, etc. and btw, all oil & gas leases will include a royalty % to be paid out if that particular lease is included in a producing unit.

you think you could find out what the monthly payments are for??

how can i find out if i own my mineral right's or not? Will it matter for the gas?

[rugerjitsu]

Originally Posted by theo2

how can i find out if i own my mineral right's or not? Will it matter for the gas?

well, it takes a fairly thorough examination of the title chain to your property...we usually are researching documents clear back to the mid 1800's.

first thing i would do is look at your deed. did the sellor (grantor) reserve the minerals?

if yes, then you don't own the minerals.

if no, then you would have to look back to the prior deed, and keep searching to find mineral reservations...it's a job!

and yes, it matters when landmen are looking to lease the mineral owner.

[Hopes]

Originally Posted by rugerjitsu

hopes, you know i'm in the oil and gas business...in the land department, and i handle leasing. i'm curious what these "monthly payments" are for if they haven't drilled yet...if she rec'd an upfront bonus payment, the lease is termed a "paid up lease", which means there won't be anymore payments unless it's royalties, damage settlements, etc. and btw, all oil & gas leases will include a royalty % to be paid out if that particular lease is included in a producing unit.

you think you could find out what the monthly payments are for??

She received an up front bonus payment AND monthly lease payments started immediately. Her property is specifically reserved for a gas line if the gas company ever needs to install one. Drilling hasn't started on any of the other properties in the unit pool. She has something called a Pugh Clause, if that helps explain it. Based on what you shared, it sounds like she negotiated herself a nice deal.

[UKyank]

Originally Posted by Hopes

She received an up front bonus payment AND monthly lease payments started immediately. Her property is specifically reserved for a gas line if the gas company ever needs to install one. Drilling hasn't started on any of the other properties in the unit pool. She has something called a Pugh Clause, if that helps explain it. Based on what you shared, it sounds like she negotiated herself a nice deal.

I'm curious what this is too.....Ive only heard of monthly payments through royalties (or special non-regular payments like paying for trees that are removed) but obviously neither of those apply of nothing is actually being done on the property now.
A Pugh clause just means that if company ties up your land with a lease & then doesn't actually develop it within a time frame then they lose it & you can re-lease it to someone else.

[BrianTH]

Just speculating, she could be getting payments for whatever surface rights (perhaps an easement) she granted for the possible gas line.