Surface Agreement Oil Gas

First of all, I would like to say that the best way to negotiate surface protection is to negotiate the actual lease of oil and gas between the oil group and the mineral owner. This assumes that the surface owner owns some or all of the minerals and has a „seat at the table“ during negotiations. The parties each have something that the other wants and it is possible to conduct real negotiations. Surface protection is an integral part of the lease itself. However, mineral property has often been „separated“ from the surface, and the first time the surface owner knows that an oil and gas lease has been tolerated is when the oil company shows up to develop the minerals. In these cases, a Surface Use agreement is probably the best alternative. In Texas, mineral products dominate surface products. Therefore, the owner of a mineral estate can freely use the surface land for the exploration, development and production of gas and oil under the land. This right to use the property may be exercised by a tenant who has entered into a mineral lease by the owner of the mineral property itself. And because a tenant can use the surface without restoring it or paying for careless damage, surface owners often acquire what is called a surface use agreement that limits the use of the surface or causes damage. Below is an overview of the surface use agreements in Texas. A Surface Use Agreement (OAS) is a contract between the surface owner and the leasing taker (usually oil and gas companies) for an oil and gas lease.

This contract describes the rights, obligations and obligations of the landowner and the operator, including the size of the surface disturbances that will be permitted during the construction of well and road cladding, and compensation for any property damage caused by the operator. This agreement helps to resolve ambiguities and uncertainties for both parties. Some states need it before a well can be drilled. Listen to this episode to learn how to negotiate a Surface Use Agreement (SUA). Questions about the applicability of the agreement; If the operator and the landowner are unable to agree on damages, some states grant the operator the right to continue the development, with damages to be determined in hindsight through arbitration or litigation. Land use agreements allow landowners and peders to reach agreement on the use of land surface during the drilling process. Such agreements are often necessary because mineral drilling can cause the surface of a land. These agreements are intended to prevent irreparable damage on land and to require the lessor to adopt a particular claim standard that may include: there are a number of common provisions, which are generally included in surface use agreements, including: – Requesting a ready-to-use meeting. Upstream, it is a good idea to meet with the mineral tenant and have a meeting to discuss operational issues. These are things like access to the door, closed doors, work schedules, etc.

Some oil and gas companies believe that surface use agreements benefit both parties and are happy to negotiate with the surface owner to avoid confrontations in the future. Setting up a meeting will allow the surface owner to determine the tenant`s willingness to cooperate. At least a surface owner can get maps and details on the extent of future operations on his land. Look for leasing arrangements. If there are already oil and gas leasing provisions that require compensation or protection for the surface owner, this is ideal. These provisions should be applied and can give the owner a good starting point to demand appropriate compensation from the lessor.

Subscribe

Comments are closed.