My family was asked to prove Heirship from our grandparents to our father. But no one ever did probate on our grandparents, who owned the mineral interests originally. So we did the Affidavit of Heirship as asked by the oil company. We hired an attorney and spent a few thousand dollars to do so. Now the oil company says we need to do a full probate on our grandparents. However since there never was a probate done on our grandparents, we don’t know how to proceed. We did do the probate on our own parents. I’m not sure why there was never one done on our grandparents. Other than these mineral interests, there wasn’t really anything else of value from their “estate.”
We have been leasing to this oil company for years. And now that our interests are producing, the oil company seems to be unwilling to pay for drilling on our rights. We have tried on numerous occasions to get their Owner Relations to get back to us. They said they are 60-90 days behind in returning calls. But this has gone on for over a year.
Has anyone else had this problem? Or does anyone have a suggestion as to how to proceed?
The oil company likely has a drilling title opinion which notes that title has not been sufficiently established in the deed records. Ask for a copy of the portion of the DTO which applies to your minerals. A lot depends on state law where the minerals are located as state laws vary. Most states have a limited time period to probate a will after death so it is unlikely that you can do a full probate. There are other ways to establish title and you need to consult an oil and gas title attorney or estate attorney for the particular state. You will get some advice if you specify the state where the minerals are located.
Good advice, ask for excerpt of Division Order Title Opinion (DOTO), better yet ask for the entire DOTO for your pooled unit. Our lease includes an addendum covenant that gives us the right to the entire DOTO. They may not give you the entire DOTO but you can ask.
Mineral Rights as well as real property can be transferred by a gift deed in Texas. There might be a possibility that your parents received the mineral rights as well as other things through a gift deed. It sounds like a “stall” tactic to me! If the oil company said the title is no good then why did they lease it in the first place? Good Luck and don’t give up!
IANAL and this is my experience and opinion only - not legal advice.
I’ve been through and am going through this exact issue. what I’ve found is that an oil company may be willing to use an affidavit of heirship to get their well drilled; but they are not going to put a well in pay status for the next generation without clear marketable title. clear title is going to require probate (depending on the state as has been mentioned). in my case, the minerals are owned in a state different than my grandfather passed in. his will was probated in the state of passing; but not in the state the mineral interest are in.
I’ve consulted 3 attorneys and the consistent message is that this will cost thousands of dollars to handle probate. the revenues (in my case) will never pay out the attorney fees. given this, I am currently in the process of trying to do this myself. my feeling is that there is nothing to lose, and possibly large amounts to gain (the “large amounts” is because there are also unleased minerals close to existing production).
another point to make is that depending on the state, you may have been paying taxes on your grandparents minerals for some time now (on their behalf); which is not fun - but at least keeps the minerals from going to a sheriff sale.
there is no easy answer here. in your case, you need to consider the total cost of ownership. if the value in these minerals exceeds the cost of the attorney, then by all means - consider getting the ancillary probate completed. if (as is the situation I have) the value of these minerals will never pay the attorneys’ costs - then you can either go it alone, or stop paying the annual ad valorem taxes; in which case the minerals will eventually be sold by the county.