Theodore Davis-very old lease

Texas Mineral Rights Dawson County, TX
1

Hi everyone, Some background before my questions- I have R.I. in the active Theodore Davis well NE/4, S 34, BLK 35 ,T4N in Dawson county. In Aug. of 23 I posted posted questions about purchase offers which have since grow larger( I do not plan to sell my MI’s). On members advice I now see on the TX RRC well site the likely reason are 4 permitted horizontal wells that I believe are operated by IKE ( who also work the Theodore Davis). They will start in S22 and 2 of them extend though the E/2 in S34.The Royalty deed I have from my grandfather is covering all of the E/2 of section 34 ( 320 a), dated11/75. The deed is for “25 years or as long as there is production”. From my parents I have old Division Orders for the E/2 from 1976 for the T. Davis well. Then another D. O.in 1985 listing the well in the SW/4 ( thought it is in the NE/4 )but the R. I. ( .0091797) amount matches the first. Then in 1986 a D. O. for the well T. Davis the in SE/4 ( thought NE/4) . Here the R.I. listed is (.013769). Same again in 1988. Then in 1996,2009 &2023 it lists NE/4 at .0091797 again. I reached out to the county clerk who sent me what I already knew. She said I need a landman. In anticipation of productive wells I had some questions that I was hoping someone might be able to help with or direct me: -So does this infer the entire E/2 original lease stands? -Why would there be a change in location & R.I.? -Would the SE/4 still be included or held by the NE/4 -T. Davis production?

  • Did these old leases ever have depth clauses?
  • Does the present T. Davis well and new horizontal well where they over lap matter or have an effect?
  • I have an oil & a gas lease #'s from 1976. Does that help?
  • Am I missing something I should really consider a landman for? Super appreciated, Blake FL.
2

#1, yes but uncommon. Depends on your definition of old. #2, yes. A term MD generally requires continuous production in order to extend beyond the primary term. #3, probably not of an consequence for your purpose today. #4, You are are already past 25 year term of the TMD. You may want a copy of the original grant to your grandfather and possibly further to assure yourself that you fully understand the conditions of the grant.

3

Thanks for the great feedback! In this case my definition is 50 years old. Seems like if there is a depth clause and the horizontal wells are below that, then a new lease is in order. With that said, why would they begin a well without lease in place?

Would you also happen to have advice on these questions? -So does this infer the entire E/2 original lease stands? -Why would there be a change in location & R.I.? -Would the SE/4 still be included or held by the NE/4 -T. Davis production? Appreciated!!!

4

50 years would be considered recent by many standards for Dawson. You need to find a copy of the controlling OGL to determine if there is a depth clause, then you can proceed with the other issues. Do not assume that you are unleased! You can try contacting the abstract company covering Dawson to try and find the OGL. Assess the economic value and then decide on the importance of finding the original OGL.

5

Hi James, THANK YOU again for helping. So, my plan is to see if the wells produce and then decide if I should pay for an abstract company or landman in the area to find the OGL before signing D.O’s.

Does anyone have a recommendation for an abstract Co. or Landman out of Lamesa, TX ? THANKS again

6

You may want to call the landman for the company that is producing on your property. They may be willing or able to provide you with the citation for the controlling OGL or TMD. That will save you a great deal of time and effort. Worst they can say is no.

7

This is the only Abstractor that I found in Lamesa https://www.yelp.com/biz/south-plains-abstract-co-dawson-county-lamesa . They may be able to suggest a local Landman.

8

THANKS again for all your insight , advice and recommendations. The company landman Idea is a good one. I also was thinking of asking the clerk if she can send the index pages for the target time frame , for me the search…

9

If you are looking for a time frame that is post 01/01/1970, then you can access that information more cost efficiently through Dawson County Clerk Records Search | TexasFile. Pre-1970 you may have more luck with the abstractor since they will most likely have the data on computer or in a tract index. The clerk will only have a grantor/grantee index.

11

Blakemores,

I have land close by and have done extensive title and lease work. Spent much time in the Dawson County Court House.

Ike propably bought the lease from Pinion.

The well on the lease has been producing since July 2024 and has produced 65 barrels.

The well did not produce from 7-2023 and 4-2024.

Most leases are only good for 90 days continuous production so technically IKE might not have a valid lease.

You need all documentation to prove it is yours. You then need a copy of the last lease.

Then you will need someone to negotiate with IKE.

You can do it yourself but experienced and qualified Landman on your side is the best option.

I used a Landman to negotiate my new lease.

These two laterals will be worth a lot of money.

12

Update- From your great recommendations I located what I believe to be the original 1972 lease. It’s amazing after 8 years of higher education how the language on the deed and lease can make my head spin! Anyway, I believe the 25 year term deed persists despite the production stop. Endeavor paid 3/23, Pinion 9/23 & IKE 5/24. The lease mentions a 3 year term, > 3year shut in & continuous effort towards production that infers the lease holds.

There is a lot about pooling all or portions and in any strata. That seems like there is no defined depth clause and anything goes for the permitted horizontal wells. On the other side, the deed fine print reads that the leasing rights remain with the original grantor. So no negotiating much better terms ,but I think that the good news would be that I still remained leased for any new wells.

I sent an E-mail to IKE requesting to contact the landman to see if these are the correct documents for their title search. Am I thinking ok on this? APPRECIATED!

13

You may have a Term non-participating mineral interest (TNPRI) from your description. In general, the 25 year term runs from issuance and can be extended by continuous production. Horizontal wells are regulated by the TX RRC, so you can participate in that regulatory process; although, the TX RRC does a great job in this area.