My sister and I inherited mineral rights in Midland County for lot 9, Block 7, out of he Barber-Cole Addition. Lease was signed Jan 30th, 2017 for 3 years by brother. Received tax stmt this year for minerals. Royalties are suspended given they are listed in the estate. The estate was probated and on file. Submitted transfer for deed for 50/50 ownership last week. Question is, is the lease legal after 3 years if no minerals were excavated until 2021? Lease states: “primary term of 3 years and as long thereafter as oil or gas or other substances covered theerby are produced from said lands”. Thanks in advance for any assistance or recommendations!
It depends on the rest of the terms in the lease. Sometimes a lease can be perpetuated by things other than just production. Operations, pooling, etc. can extend a lease passed its primary term. You should have a local O&G Law attorney look at it.
Also, I’m confused. You said there were royalties in suspense? That would suggest there has been production.
Production in 2021. Lease agreement was from 2017 to 2020. It looks like it will be transferred from this lease agreement and continued. We were initially told the probate document was only needed for heirship and not a deed transfer in Texas, so it was left in the estate. We were receiving a lot of offers for lease/purchase this year from other companies.
You will get better response if you identify the well(s) and operator. Were the wells spud before the end of the primary term, as opposed to the date of first production? Could the wells have produced for a short time and then been shut-ion? Did the lease have a option to extend the primary term, and if so did the lessee exercise the option.
It appears that another lease was in effect. We received a tax stmt for 2021 for the following: Legal: Acres: 404.833, MASSEY A UNIT, PIONEER NATURAL RES., T1S BLK X SEC 1 A-11, RRC#54985 SEC 1-2-14-23-26
The Well/Lease names are: (Does the completion date mean these wells did not produce in 2021?)
API 42-329-43103 MASSEY A UNIT 2809H MASSEY A UNIT Midland County, TX PIONEER NATURAL RES. USA, INC. PRODUCING Completion date: 2020-03-25
API 42-329-43102 MASSEY A UNIT 4209H MASSEY A UNIT Midland County, TX PIONEER NATURAL RES. USA, INC. PRODUCING Completion date: 2020-03-23
API 42-329-43120 MASSEY A UNIT 4309H MASSEY A UNIT Midland County, TX PIONEER NATURAL RES. USA, INC. PRODUCING Completion date: 2020-03-21
Thank you for any information that you in regards to if and when the wells are producing or not, and whether the above property is included. Sharon
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