Oil and Gas at Your Door? (2005 Edition) - Earthworks

STAGES OF OIL & GAS DEVELOPMENT
In most states, something called force (or compulsory) pooling exists. In this chapter, the section
on Field Organization provides information on forced pooling. Chapters II and III provide
more information on mineral leasing, including Tips on Negotiating Leases.
If you don’t own the minerals
If landowners do not own mineral rights to the oil and gas beneath their land, they do not have the
legal right to stop a company from coming onto their land to explore for or develop oil or gas. This
seems to put the landowner at a great disadvantage when dealing with oil and gas companies.
According to the Real Estate Center of Texas, however, if you don’t own the mineral rights you still
have options: 32
1. Attempt to purchase all or part of an interest in the minerals beneath your land. By doing
so, companies may have to negotiate with you in order to lease the property. You'll have
more power if you own at least some of the mineral rights.
2. If all or part of the minerals cannot be purchased from the mineral owners, you may
attempt to purchase the right of ingress and egress from them. Giving up this right does
not affect the ability of the mineral owner (i.e., the lessor) to lease the minerals and collect
royalty payments from the company. But it would require the company who has leased
the minerals (i.e., the lessee) to make arrangements with you before entering to explore
or develop a well on your property.
3. Contact the party who does own the minerals, and attempt to work out a land-use agreement.
For example, you may ask mineral owner to restrict the company's operations to a
certain section of land. Remember, however, that the mineral owner is under no legal obligation
to enter into such an agreement.
4. Contact the mineral owner and work out a surface-use and surface-damage clause to be
included in future leases between the mineral owner and an oil or gas company.
5. Attempt to negotiate a Surface Use Agreement directly with the oil or gas company. In
some states this is required by law. There is more information on Surface Use Agreements
in Chapters II and III.
Landowners should be
aware, also, that there are
laws and regulations that
require companies to
behave in an environmentally
responsible manner;
there are agency processes
(e.g., permits) that may provide
surface owners with
the opportunity to comment
on proposed oil and
gas developments; and
there are legal cases that
have led to increased surface
owner rights and protections.
Chapters II and III
provide more information
on these topics.
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