What to Consider When Hiring an Oil & Gas Lawyer
Oil and gas law is a rare area of practice in the United States, with only a small number of attorneys who still represent individuals during mineral lease negotiations. Yet, oil and gas lawyers have not become obsolete. Disputes over mineral ownership commonly occur in the United States.
Oil and gas law pertains to the acquisition of minerals and the rights to their production profits. In the United States, these minerals may be privately owned by individuals, whereas in Europe and other countries oil and gas is owned by the government. The property owner holds the rights to these minerals unless specifically severed in a previous deed or agreement. Oil and gas rights can be bought, sold or transferred as real estate. Gas and oil laws vary by state so it is best to contact an expert oil and gas lawyer.
If you are a mineral owner, you may have already been contacted by a company with a lease proposal. Oil companies will propose an Oil, Gas and Mineral Lease when they think they can make a profit from the minerals beneath your land. A typical lease grants the mineral owner an up-front lease bonus payment and a royalty percentage in exchange for the right to drill and produce. Drilling operations can last ninety days or longer. The lease expires if no drilling takes place.
Mineral leases can be very complex. In addition to your percentage of the profits, be sure to negotiate fair compensation for surface estate damage and undue use. Properly negotiating oil and gas leases takes time and patience. Act professionally and do not be too quick to sign any legally binding documents. It may benefit you to hire an oil and gas lawyer to oversee negotiations and represent you should disputes occur.
The price of crude oil and natural gas is determined by supply and demand within the global economic market. During negotiations, determine the physical price you (the mineral owner) and the oil company will receive from production. Also keep in mind that state governments incur a severance tax when oil and gas are removed from the earth. Each state sets its own tax rate.
Do not be too eager to sign the first mineral lease proposal you receive. First, do your research and feel free to shop around. Represent yourself or hire an oil and gas lawyer for an additional source of knowledge. You have a right to profit from any minerals within your property. Defend that right.
Oil and gas law pertains to the acquisition of minerals and the rights to their production profits. In the United States, these minerals may be privately owned by individuals, whereas in Europe and other countries oil and gas is owned by the government. The property owner holds the rights to these minerals unless specifically severed in a previous deed or agreement. Oil and gas rights can be bought, sold or transferred as real estate. Gas and oil laws vary by state so it is best to contact an expert oil and gas lawyer.
If you are a mineral owner, you may have already been contacted by a company with a lease proposal. Oil companies will propose an Oil, Gas and Mineral Lease when they think they can make a profit from the minerals beneath your land. A typical lease grants the mineral owner an up-front lease bonus payment and a royalty percentage in exchange for the right to drill and produce. Drilling operations can last ninety days or longer. The lease expires if no drilling takes place.
Mineral leases can be very complex. In addition to your percentage of the profits, be sure to negotiate fair compensation for surface estate damage and undue use. Properly negotiating oil and gas leases takes time and patience. Act professionally and do not be too quick to sign any legally binding documents. It may benefit you to hire an oil and gas lawyer to oversee negotiations and represent you should disputes occur.
The price of crude oil and natural gas is determined by supply and demand within the global economic market. During negotiations, determine the physical price you (the mineral owner) and the oil company will receive from production. Also keep in mind that state governments incur a severance tax when oil and gas are removed from the earth. Each state sets its own tax rate.
Do not be too eager to sign the first mineral lease proposal you receive. First, do your research and feel free to shop around. Represent yourself or hire an oil and gas lawyer for an additional source of knowledge. You have a right to profit from any minerals within your property. Defend that right.
Source...