Has anyone ever had a lease held by production with no depth clause and took it to court citing it was unfair? From what I have been told, you can do this and with a fair chance at success win with the result being that lease is held at whatever the existing depth is. This means you can lease to a new company at a different depth, meaning bonus higher royalties. I need input. I’m tired of the people in this industry taking advantage of the families that have owned these lands for generations like mine. I’m just being honest. These are families’ homes and how we make a living. So you understand, I married a wonderful lady named Tracy Lynn Kuntz. I’ll bet some of you recognize the name Kuntz. My job, which I take a lot of pride in, is taking care of her and making her father, grandfather, great grandfather, and her great grandmother Ulga Kuntz proud. All of these people worked hard for their family. So if anyone has any input that may help, please advise.
Your lease needs to have a retained acreage clause which limits the lease to 50 or 100 feet below the deepest producing formation. This allows the mineral owner to lease the deeper rights when the deeper formations become feasible to drill. And, the retained acreage clause needs to have a provision where lease terminates automatically for the undrilled acreage when the shallower formations are classified as non-producing. If your lease does not have a depth provision in the retained acreage clause, you will not be able to place the deeper rights up for bid until a court decides you have the right to do so. I have never found the court rule in my favor to get deeper rights released from the leased acreage of a producing well. Maybe someone else has had such luck.
Thank you for the info. Have you heard of a person without those clauses winning in court? And thank you for trying to help from our family. Thank you.
Know I have not. The Oklahoma Corporation Commission rules will govern, but you could call an oil and gas attorney and ask.
No, I have not either.