I really appreciate all the information I am learning from the well versed contributors in this forum. Thank you.
Would taking out a land equity loan make it any less likely that a company would want to drill on land I own? I don’t own the minerals, so we’re only talking about damages here. In what ways would a land equity loan complicate the deal? For instance, would the bank that makes the land equity loan need to be involved in the drilling and pipeline damages paperwork? What else do I need to consider?
You would need to talk to the lending officer as the answer may depend upon the institution’s rules and the situation. The operator is looking for a flat spot of about five acres for a surface location for drilling either into your section or the one next door. After drilling, the surface location usually decreases in size to about an acre or so (depending upon the type of drilling and if there are multiple wells.) The surface owner will have a surface lease that handles damages, etc. The mineral owners will have a different mineral lease. A drillsite is not usually allowed within 200 feet of a barn or home. Other states have different setbacks. Land use is also a factor. Timber, farming, cattle, etc.
Surface owners would be wise to get a good oil and gas attorney to look at any surface lease to make sure that the proper protections are in place.
Do you have someone atively seeking your property for well pad/pipeline sites? Talk to them about it, they do this everyday and can give you a lot of answers. But yes, if you have a mortgage on your property, the drilling/pipeline company will more than likely want the bank to sign off on it. Doesnt mean the bank gets the money, its quite common practice.