Hillsborough Florida Use of Produced Oil Or Gas by Lessor

State:
Multi-State
County:
Hillsborough
Control #:
US-OG-839
Format:
Word; 
Rich Text
Instant download

Description

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.

Hillsborough County, located in the state of Florida, is a bustling region known for its diverse economy and significant contributions to the use of produced oil and gas by lessors in the region. The county encompasses various types of oil and gas activities, such as exploration, drilling, production, and extraction, making it an essential hub for the energy industry. With its strategic location along the Gulf of Mexico, Hillsborough County has access to abundant offshore reserves, allowing for the extraction of oil and gas resources both on land and in the coastal waters. The use of produced oil or gas by lessors in Hillsborough County is primarily driven by the need for energy and fuel sources across different sectors. This includes residential, commercial, industrial, transportation, and power generation applications. Oil and gas are vital resources, providing heating, electricity, transportation fuel, and raw materials for various manufacturing processes. In Hillsborough County, there are several types of oil and gas production pursued by lessors: 1. Onshore Oil and Gas Activities: Lessors engage in drilling and extracting oil and gas resources from land-based wells. This involves the use of advanced technology and equipment to access hydrocarbon reservoirs beneath the surface. 2. Offshore Oil and Gas Activities: Hillsborough County's coastal location enables lessors to tap into offshore oil and gas resources in the Gulf of Mexico. This type of production typically involves drilling rigs, platforms, and subsea infrastructure to extract oil and gas deposits beneath the ocean floor. 3. Natural Gas Processing: Apart from oil, lessors in Hillsborough County focus on the production and processing of natural gas. Natural gas processing facilities extract valuable components such as methane, ethane, propane, butane, and pentane to meet the demand for clean and efficient fuel sources in residential and commercial sectors. 4. Refining and Distribution: Hillsborough County plays a significant role in refining the extracted crude oil into various end products such as gasoline, diesel, jet fuel, lubricants, and other petroleum-based products. These refined petroleum products then undergo distribution to be made available for consumer use. 5. Chemical Manufacturing: In addition to fuel production, oil and gas by-products serve as vital raw materials for the chemical manufacturing industry in Hillsborough County. These by-products are transformed into plastics, fertilizers, solvents, and countless other chemical compounds essential for various industrial processes. Overall, the use of produced oil and gas by lessors in Hillsborough County is a dynamic and essential industry, driving economic growth and providing energy resources to meet the diverse needs of the region. With a focus on both onshore and offshore production, natural gas processing, refining, and chemical manufacturing, Hillsborough County remains a critical player in the energy sector.

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FAQ

An oil and gas lease is a hybrid property interest. For some purposes it can be considered a personal property and for other purposes it can be treated as real property. Under an oil and gas lease, the lessee holds the dominant property and the lessor holds the servient property.

According to Kramer, a lease that is executed by owners of separate tracts (or separate interests in the same tract) is known as a community lease and effectively pools the interests covered by the lease unless a contrary intent is expressly provided in the provisions of the lease itself or an amendment to the lease.

A mineral lease is a contractual agreement between the owner of a mineral estate (known as the lessor), and another party such as an oil and gas company (the lessee). The lease gives an oil or gas company the right to explore for and develop the oil and gas deposits in the area described in the lease.

The annual rentals required under all oil and gas leases issued since December 22, 1987 is $1.50 per acre (or partial acre) for the first five lease years and $2.00 per acre (or partial acre) thereafter.

Oil and gas exploration companies generally want to hold the leased mineral rights for a period of years until they actually begin drilling. This could be because the price for natural gas is down, or their rigs are operating elsewhere, or for any number of business reasons.

The royalty. It is typically expressed as a fraction or a percentage. 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.

Pooling refers to joining together enough acreage to allow issuance of a drilling permit for a single well. Unitization refers to joining together large areas such as an entire reservoir or field to optimize operations, introduce efficiencies, and reduce costs. Both pooling and unitization can be voluntary or forced.

A mineral lease is a contractual agreement between the owner of a mineral estate (known as the lessor), and another party such as an oil and gas company (the lessee). The lease gives an oil or gas company the right to explore for and develop the oil and gas deposits in the area described in the lease.

The federal government charges oil and gas companies a royalty on hydrocarbon resources extracted from public lands. The standard Federal royalty payment was 12.5%, or a 1/8th royalty.

Accordingly, when you see the words Paid-Up Lease, this normally means that you will receive an upfront bonus for which the oil and gas company does not have to do anything during the initial or primary term of the lease.

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Hillsborough Florida Use of Produced Oil Or Gas by Lessor