Weatherford, Texas (PressExposure) May 19, 2009 -- Old oil and gas leases can be turned into a potential gold mine for royalty owners if they take the right steps now to obtain more favorable terms, according to Weatherford oil and gas attorney Mark Humphreys.
âA lot of old leases can be broken if the royalty payments have ceased or dropped off to only two or three per year,â Humphreys said in a video posted on his web site at [http://www.markhumphreyslawfirm.com/oil-gas/]. âItâs very likely these leases can be broken. Weâve been successful doing this in the past, and weâre going to continue to be successful.â
Potentially Millions of Dollars
âWeâre not talking about a signing bonus of a couple hundred bucks,â Humphreys noted. âWeâre talking about potentially millions of dollars in royalties on a bigger lease, and certainly thousands of dollars even on the smaller leases in the Dallas-Fort Worth area.â
Humphreys described it as âa real big mistakeâ for a landowner to focus only on the two paragraphs out of the 20 or more in a typical lease that address the bonus and royalty amounts. Typically found in oil and gas leases are provisions governing: â¢ Habendum clause estate ownership rights â¢ Force majeure declarations â¢ Pooling agreements â¢ Lease termination requirements â¢ Post-production land use â¢ New wells and wells on adjoining properties wells
âEvery paragraph in a lease means something,â according to Humphreys. âThe oil and gas companies pay big bucks to landmen and lawyers to review and negotiate the leases. Yet all too often a landowner talks to his next door neighbor and decides whether itâs a good deal or not. Youâve got to have a lawyer look at these things,â Humphreys added.