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.
The Harris Texas Pugh Clause is a provision included in oil and gas leases that grants termination rights to the lessor or landowner. This clause ensures that wells drilled on the leased property do not continue to hold the entire leased land indefinitely, allowing the lessor to negotiate new lease terms or seek out other opportunities for development. The Harris Texas Pugh Clause effectively separates the leased premises into distinct units or tracts, with each tract being subject to its own specific lease. It states that a well drilled on a specific tract shall only hold that tract, and once production ceases, the lease on that particular tract expires. This allows the lessor to have greater control over their property and ensures that the lessee cannot hold the entire leased acreage without actively producing from each individual tract. There are few variations or types of Pugh Clause commonly associated with the Harris Texas jurisdiction. One such type is the Vertical Pugh Clause, which stipulates that the expiration of the primary lease term is limited to the depths or formations that have been drilled or are actively producing. This means that if only a certain interval is being developed, the remaining unproductive depths or formations will be released from the lease. Another commonly seen type is the Horizontal Pugh Clause, which applies when the lessee employs horizontal drilling techniques. The clause determines that each individual tract is considered a separate lease, and if the lessee fails to drill and produce from a specific area within a given period, that particular tract will expire, leaving the rest of the leased land open for negotiation or lease restructuring. The Harris Texas Pugh Clause is crucial for lessors as it safeguards their interests and prevents lessees from indefinitely holding large tracts of land with minimal production. It ensures fair and equitable development of the leased premises by requiring focused drilling activity on specific areas and allowing for the negotiation of new lease terms or additional lessees to take advantage of unproductive sections. In summary, the Harris Texas Pugh Clause allows the lessor to maintain control over their land and requires the lessee to actively develop and produce from individual tracts. It separates the property into distinct units, ensuring that once production ceases in one specific area, the lease on that tract expires. This provision promotes fairness, clarity, and efficient resource management in oil and gas operations in Harris Texas.The Harris Texas Pugh Clause is a provision included in oil and gas leases that grants termination rights to the lessor or landowner. This clause ensures that wells drilled on the leased property do not continue to hold the entire leased land indefinitely, allowing the lessor to negotiate new lease terms or seek out other opportunities for development. The Harris Texas Pugh Clause effectively separates the leased premises into distinct units or tracts, with each tract being subject to its own specific lease. It states that a well drilled on a specific tract shall only hold that tract, and once production ceases, the lease on that particular tract expires. This allows the lessor to have greater control over their property and ensures that the lessee cannot hold the entire leased acreage without actively producing from each individual tract. There are few variations or types of Pugh Clause commonly associated with the Harris Texas jurisdiction. One such type is the Vertical Pugh Clause, which stipulates that the expiration of the primary lease term is limited to the depths or formations that have been drilled or are actively producing. This means that if only a certain interval is being developed, the remaining unproductive depths or formations will be released from the lease. Another commonly seen type is the Horizontal Pugh Clause, which applies when the lessee employs horizontal drilling techniques. The clause determines that each individual tract is considered a separate lease, and if the lessee fails to drill and produce from a specific area within a given period, that particular tract will expire, leaving the rest of the leased land open for negotiation or lease restructuring. The Harris Texas Pugh Clause is crucial for lessors as it safeguards their interests and prevents lessees from indefinitely holding large tracts of land with minimal production. It ensures fair and equitable development of the leased premises by requiring focused drilling activity on specific areas and allowing for the negotiation of new lease terms or additional lessees to take advantage of unproductive sections. In summary, the Harris Texas Pugh Clause allows the lessor to maintain control over their land and requires the lessee to actively develop and produce from individual tracts. It separates the property into distinct units, ensuring that once production ceases in one specific area, the lease on that tract expires. This provision promotes fairness, clarity, and efficient resource management in oil and gas operations in Harris Texas.
