Hello and thank you in advance for any responses.
I am studying petroleum land management and currently a newer R.O. I am learning about marketable and unmarketable titles. One of my text books describes a reason that a title may be unmarketable may be because a previous o&g lease was “unreleased”. What does that mean? What is the best way to ensure any new lease in the future is valid after a previous lease? What obligations do have to any oil company after a lease has expired, if any?
The term unreleased is the equivalent as not released. In other words the terms of the lease have not been complied with so the lease expires. As landmen, we use all resources available to determine what lease, if any, is a current lease. For most intents and purposes, if no operations were ever undertaken by the lessee or their assignee, there are no obligations for the lessee to do anything. Some leases require the lessee to record a release of the lease. Most do not.
Many O&G leases will have a clause that states the producer will file a release of the lands not held by production. As an example, 2,000 A. 10 wells at 40A per well, continuous drilling has stopped and no other clause or activity can be considered to be in effect to hold the remaining 1600 A then the producer is obligated to file a release in the deed records.
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