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Monday, February 17, 2014

Drillers Will Find Ways to Avoid Re-Leasing As End of Lease Term Closes In

From WKSU News:
Billions of dollars worth of oil and gas leases have been signed in Ohio since 2009. And, expiration dates are rolling up on many early ones -- where there’s been no drilling. Re-leasing is an option for energy companies, but that could be expensive.  And they may not need to.  
A lot of locations have proven non-viable for drilling so they don’t want those anyway.  Then there’s a move some companies are making of filing papers at the last minute saying a property is being folded into a development unit where drilling is taking place—that in, legal terms, will “hold the lease by production.” And, in our part of Ohio, attorney Alan Wenger says there’s another wrinkle. 
“A large portion in the northern counties were already leased for conventional wells.  And the horizontal drilling companies took the assignment of deep rights from those older leases, already ‘held by production’ by the conventional wells.So they go on and on and on, as long as the conventional well is here.”
Read the whole article by clicking here. 

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