What is in this article?:
Attorney James Decker’s advice to ranchers entering lease agreements for oil and gas exploration on their land is to have a lawyer with expertise in the subject and mineral rights on your team.
Outside of failing to see a lawyer, what are the other common mistakes landowners might commit?
“First and foremost, when you buy or lease property for agricultural production, learn who owns the mineral rights under it. Many folks assume that because they bought or inherited the property, that they own the mineral rights. Later, they learn someone else owns an interest in the minerals.”
Decker adds that if you’re buying property and the seller wants to retain the mineral rights, the buyer should ensure he has the final say in leasing of the property for mineral extraction. Without this authority, the surface owner has little influence in how the surface of their property is used. He advises having a lawyer check the terms of the agreement.
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“My job is to ensure my clients have their surface use protected. I have a checklist of things I look for and work to include, but the key is to make sure the inconvenience to the surface owner is minimized,” he says
So how does a landowner find a lawyer with the appropriate expertise? In the absence of a “good, user-friendly database for lawyer referrals within the agriculture world,” Decker advises landowners to seek referrals from other landowners.
“I’ve found that folks typically are happy to share both their good and bad lawyer experiences, both of which are useful, with their neighbors and friends. Beyond that, your regional and state farm/ranch organizations will typically have some referrals as well,” he says.
The bottom line, Decker says, is to negotiate a good oil lease upfront and make sure it’s upheld.
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