I’m looking for leads on pipeline easement rates in the Permian. Anyone have any information or tips/tricks on how to find the rates? Very few companies list their rates in the recorded document. Thanks!
Check with the neighbors is all I can suggest. If I weren’t in dire straits, I wouldn’t want a pipeline on my land unless it was the most useless plot of land in all creation. All the hours and legal expense you will have to go through to protect yourself and negotiate you might be disappointed with what you wind up with. If you make an agreement with them and aren’t paid enough to support a lawsuit against them later if they don’t live up to the terms of the agreement? I would think I didn’t make enough off it.
Two- if everyone thought like that there would be no gas production.
Darn auto correct. Instead of two, it is supposed to be RWK.
Pipeline negotiations can be complicated and the terms of the agreement matter. Look at the Rate and Damage Schedule of University of Texas Lands System for some guidance. Texas A&M Agrilife website has good checklist for negotiation points and considerations. The strength of your position depends on the pipeline length on your tract and whether it is an eminent domain situation. You may be able to have it moved to edge of your land instead of going through the center. You may want to have an attorney negotiate for you. This is a specialty area and the attorney will charge a percentage of the difference in compensation between the initial offer and the final payment.
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If at all possible lease rather than sale. I ended up with property that sold 90+ years ago for $0.25/rod. All owners since that time have not collected one cent for the use that has occurred. Work an annual increase into the lease to cover inflation. You are basically selling something that you will always be constrained and pay property tax on and the ROW owner just rides along. I use the market value of the property as a basis and then inflate over time of lease. If you choose one and done then that is final and all following owners are constrained by your agreement. It is tough territory for sure but necessary. Try to think out ahead how it will affect the future then collect funds accordingly…
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In 42 years of law practice I have not come across even one pipeline company that will lease an easement instead of purchasing it. This is especially the case where it is a common carrier line and the pipeline company can use eminent domain to acquire the easement. It’s possible that if the pipeline is a local gathering line (for which there are no eminent domain rights) an oil company might consider leasing, but I can’t say I’ve seen it for these lines either. Could I ask which pipeline company agreed to lease to you?
I am in a similar situation. I understand eminent domain vs private. So what is a 16 inch gas line going fir per rod connecting to a 24 inch line on a different section
@Caroline_Brady - that’s what I’m trying to figure out too! I will report back if I find anything.
@AimeeHess - a deed records search in Midland County will bring up a ton of 10 year Pipeline Easements with numerous entities including common carriers (actually, mainly common carriers). However the rates are not listed in any of the documents. I’m trying to see if I figure out what 10 year easements are going for per rod.
One general place to look is at the University of Texas site. They have examples of leases for pipeline easements. Be sure and get an oil and gas attorney that specializes in easements to look at any lease as you need to protect your surface rights for a very long time!
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