This form is used when the Lessor desires to sell, subdivide, or partition all or a part of the lands covered by the Lease (the Lands ), and has requested a partial waiver of surface use of certain portions of the Lands subject to the Lease, and a waiver is agreeable to Lessee. This Agreement relates solely to the surface use and does not in any other way affect or diminish the Lessee's rights, interests and estate under the Lease.
Agreement Waiving Surface Use by Oil and Gas Lessee
State:
Multi-State
Control #:
US-OG-655
Format:
Word;
Rich Text
Instant download
Description
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Key Concepts & Definitions
Agreement Waiving Surface Use by Oil and Gas: This refers to a legal contract where the landowner allows the oil and gas companies, referred to as the 'gas lessee', to extract subsurface minerals without using the surface of the land. Waiving Surface: This term specifically implies that the surface of the land will not be disturbed by the operations of oil and gas extraction.
Step-by-Step Guide
- Determine the Need for an Agreement: Assess whether your business operations require access to oil and gas minerals and if surface use is a concern for the real estate involved.
- Consult With Legal Experts: Discuss the specifics of an agreement waiving surface use with a legal professional to understand implications for both parties, including any landlord tenant laws.
- Negotiate Terms: Work with the gas lessee to agree on terms that protect your company interests while accommodating their extraction needs.
- Finalize and Sign the Agreement: Ensure all parties agree on the details, and proceed with signing the legally binding document.
Risk Analysis
- Legal and Financial Risks: Inadequate terms might lead to disputes or financial losses linked to property damage or improper use.
- Environmental Impact: Even with surface non-use, underground drilling could risk ecological balance and potentially violate environmental regulations.
- Reputation Risks: Associations with the oil and gas sectors might affect public perception, especially for small businesses focused on eco-sensitivity.
Key Takeaways
- Understand and communicate clearly the terms outlined in the agreement waiving surface use.
- Maintain compliance with all relevant environmental and real estate laws to protect both surface and subsurface stakeholders.
- Regularly review and update the agreement, especially in cases of a name change or altered business structure.
Best Practices
- Maintain Transparency: Ensure all terms are clear to all parties involved in the agreement. Transparency helps prevent misunderstandings and legal complications.
- Environmental Assessments: Conduct thorough environmental impact studies before finalizing any oil and gas agreements to ensure sustainable practices are upheld.
- Regular Monitoring: Continually monitor the extraction process to ensure compliance with the agreement and address any concerns promptly.
Common Mistakes & How to Avoid Them
- Overlooking Fine Print: Don't ignore any details in the agreement. Each clause can have significant impacts, so review them meticulously.
- Failing to Update Documents: Always update agreements following any business changes, including name changes or change in company interests.
- Neglecting Stakeholder Consultation: Involve all relevant parties, including landowners and tenants, in the negotiation process to avoid future conflicts.
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FAQ
When mineral rights are owned by a third party, it may affect your use of the surface in the future. Surface rights are subservient to mineral rights, which means the owner of a mineral servitude will be able to access and use the surface to extract the minerals from underneath.
For many years, almost all oil and gas leases reserved a 1/8th royalty. Today, the royalty fraction is negotiable, and is usually between 1/8th and 1/4th. Bonus. The bonus is the amount paid to the Lessor as consideration for his/her execution of the lease.
(Oil & Gas Exploration and Production) An oil, natural gas, and mineral lease gives the lessee rights to exploit minerals beneath the surface of the property.It also grants the lessee the right to utilize the surface of the property to access those minerals.
Texas courts have long held that the mineral estate is the dominant estate, and that the mineral owner, or the owner's lessee, has an implied easement to use the surface in a manner that is reasonably necessary to develop the minerals.
In states with split ownership laws, land can be sold to only include surface rights. This means that if oil or gas is present under the soil, the landowner will have no legal rights to them.
In the event oil and gas were found and the wells produce, then the royalties kick in. So if the oil well produce 100 barrels a day, and the price of oil is $80 per barrel that month, then the cash flow is 100x$80 = $8,000/day The royalty owner, who agreed to 15% royalty, would receive $8,000 x 0.15 = $1,200/day.
Surface lease means a lease, easement, or other agreement providing the holder with the right to enter the surface of any land for the purpose of constructing and operating a well, facility, flowline, roadway, or power line; Sample 1. Based on 1 documents. Save.
An oil lease is essentially an agreement between parties to allow a Lessee (the oil and gas company and their production crew) to have access to the property and minerals (oil and gas) on the property of the Lessor. The lease agreement is a legal contract of terms.It establishes the primary term of the lease.