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Oil And Gas Leasing

In Pennsylvania, land ownership can be split into two distinct sets of rights or "estates," the surface estate or the subsurface estate. It is important to understand the owner of the oil and gas can be different than the owner of the land that is situated above the oil and gas estate.

Leases for oil and gas rights are very different from other standard contracts. The complexity of these leases requires the expertise of a qualified attorney to protect your rights and maximize your value. Landowners in Pennsylvania may or may not accept the terms of a standardized oil and gas lease. The negotiable terms generally include, but are not limited to:

  • Length of lease
  • Amount of royalties and royalty calculations
  • Amount and calculation of bonus payments
  • Lease renewal and expiration terms
  • Use of surface property and restrictions
  • Responsibility for returning property to original condition at expiration
  • Water testing standards

For surface estate owners, a gas company's drilling activities may require, among other things, interference with your valuable agricultural resources, installation of natural gas pipelines across your land and construction of compressor units on your property. No matter what your individual circumstances require, Hopkins Heltzel will customize and tailor an agreement for your specific case.

With recent improvements in the technology used to extract oil and gas reserves within the Marcellus Shale, landmen representing large oil and gas companies have rushed to secure leases for oil and gas subsurface rights. Pennsylvania landowners know there could be value underneath their property. The decision to lease your oil and gas rights can prove to be difficult, and may be made more complicated by pressure to act quickly. Before signing an oil and gas lease or surface use agreement, it is important to have the lease and agreement reviewed by an experienced oil and gas lawyer. The lawyers at Hopkins Heltzel will ensure you have a legally binding contract that maximizes the value of your rights.

Hopkins Heltzel Law Firm represents landowners who have joined landowner coalitions to achieve goals that benefit all members of the coalition. Each coalition has two primary objectives. First, each landowner coalition acts to maximize the value of the natural gas located thousands of feet below the surface of members' properties. With the advent of horizontal drilling technologies, gas companies are able to harvest substantial amounts of oil, gas and other minerals that were previously trapped in significant shale rock formations. Although we are currently in a difficult market, the benefit of joining a landowner coalition is that by aggregating a large block of properties, members improve their chances of negotiating optimal lease terms and maximizing values of their gas rights.

The second objective of each landowner coalition is to protect and preserve members' land and water sources from abuse and contamination by gas companies. Oftentimes, when gas companies approach landowners to lease their oil and gas rights, the companies try the high-pressure sales approach. Almost invariably, the standard lease agreements that landowners will be asked to sign permit an oil and gas company broad and unfettered discretion to use landowners' properties. Each landowner coalition seeks to protect members' rights and ensure members' properties are not abused by a gas drilling company.

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