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.
Allegheny Pennsylvania Shut-In Gas Royalty refers to the royalties received by a landowner or mineral rights' holder for natural gas production that is temporarily halted or shut-in due to market conditions or other factors. This type of royalty is specific to the Allegheny region in Pennsylvania, where significant natural gas reserves are present. Shut-in gas royalty is a payment made to the owner of the mineral rights for the potential loss of income during the period when production is suspended. This can occur when drilling operations are completed, but the produced gas cannot be sold or transported to the market due to a lack of infrastructure or unfavorable market conditions. In such cases, the gas remains in the well or reservoir until the situation improves. The shut-in gas royalty compensates the land or mineral rights' owner for the potential loss of revenue that would have been generated if the gas had been sold during the shut-in period. It serves as a financial protection to minimize the impact on the owner's income. In Allegheny Pennsylvania, where the Marcellus Shale formation is a prolific natural gas reservoir, there are mainly two types of shut-in gas royalties: 1. Temporary Shut-In Gas Royalty: This type of shut-in occurs when the gas production is halted temporarily, usually due to unfavorable market conditions, low gas prices, or lack of transportation infrastructure. The landowner receives royalties during the shutdown period until gas production resumes. 2. Long-term Shut-In Gas Royalty: This type of shut-in is more permanent and typically occurs when there are prolonged delays in the development of necessary infrastructure, such as pipelines or processing plants. The gas remains shut-in until the infrastructure is built or market conditions improve significantly. Keywords: Allegheny Pennsylvania, Shut-In Gas Royalty, natural gas production, market conditions, mineral rights' holder, shut-in period, Marcellus Shale formation, gas prices, transportation infrastructure, temporary shut-in, long-term shut-in.
