This lease rider form may be used when you are involved in a lease transaction, and have made the decision to utilize the form of Oil and Gas Lease presented to you by the Lessee, and you want to include additional provisions to that Lease form to address specific concerns you may have, or place limitations on the rights granted the Lessee in the “standard” lease form.
A Nevada Reservation of A Call on, Or Preferential Right to Purchase Production by Lessor refers to a legal provision that grants the lessor (landowner) the exclusive right to purchase the production or yield from a specific property before it is offered to others. This is right, commonly used in the oil and gas industry, ensures that the lessor has the opportunity to benefit from any potentially lucrative production on their land. Nevada offers different types of reservations of a call on or preferential right to purchase production by the lessor, depending on the specific circumstances and agreements. These reservations can vary in terms of duration, scope, and other provisions. Here are a few key types: 1. Time-Limited Reservation: A time-limited reservation of a call on, or preferential right to purchase production is one where the lessor has the right to purchase the production for a specified period. This period could range from several months to years, depending on the terms outlined in the lease agreement. 2. Depth or Zone-Specific Reservation: In this type of reservation, the lessor retains the right to purchase production from a specific depth or zone within the property. This reservation ensures that the lessor can profit from potentially valuable resources located at specific levels or zones. 3. Production-Specific Reservation: With a production-specific reservation, the lessor has the right to purchase a specific type of production. For example, if the property has potential for both oil and gas production, the lessor might have a reservation to purchase either or both types of production. 4. Competitive Bidding Reservation: In some cases, the lessor may choose to exercise their reservation through competitive bidding. This means that when production becomes available, multiple interested parties can submit competitive bids, and the lessor can select the highest bidder to sell the production to. 5. First Refusal Reservation: A first refusal reservation grants the lessor the right to match or better any offer received by the lessee (producer) from a third party when they wish to sell the production. This type ensures that the lessor has the first opportunity to acquire the production and prevent it from being sold to an external party. 6. Percentage Based Reservation: This reservation allows the lessor to purchase a specific percentage of the production from the property. For example, if the lessor has a 10% reservation, they have the right to purchase 10% of the total production. In conclusion, a Nevada Reservation of A Call on, Or Preferential Right to Purchase Production by Lessor provides the lessor with the exclusive right to buy the production from their property before it is offered to others. These reservations can be time-limited, depth or zone-specific, production-specific, involve competitive bidding, first refusal, or be percentage-based, depending on the terms of the agreement.
