Header graphic for print
Oil & Gas Law Report Reporting on recent legal developments and trends in the oil and gas industry.

Category Archives: Exploration & Production

Subscribe to Exploration & Production RSS Feed

Utah decision highlights unregistered finder risks in sale of oil and gas investments

Posted in Contracts and Leases, Exploration & Production, Securities

As we have noted previously, the sale to investors of interests in an oil and gas venture typically involves the sale of a security under federal and state securities laws, regardless of whether the investment vehicle is stock, a limited partnership or limited liability company interest, or even a fractional undivided interest in a lease (such as a working interest) if the investor is relying on someone else to manage operations. A corollary of this principle is that persons involved in marketing and selling the investment, if they receive compensation based on the transaction, must be licensed as a broker under state and federal securities laws. The lore that an unregistered “finder” can perform such services is mostly just that — lore. For the issuer, the consequence may well be loss of an exemption from registration and rescission claims from investors.  For the “finder” it may mean that his contract is not enforceable.

In Legacy Resources, Inc. v. Liberty Pioneer Energy Source, Inc. (No. 20120142, Dec. 20, 2013), the Utah Supreme Court held that a finder of investors for a prospective oil and gas project could not enforce an agent agreement with the issuer because the finder acted as an unregistered broker in violation of the Utah’s state securities laws. The court noted that the record contained undisputed evidence that the finder:…


Continue Reading →

Ohio Supreme Court accepts second Dormant Mineral Act case

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Real Estate

The Ohio Supreme Court recently accepted a new group of civil cases; among them is Chesapeake Exploration, LLC v. Buell. In this case, the Supreme Court has agreed to answer the following two questions of Ohio law certified by United States District Judge Watson of the Southern District of Ohio in Case No. 2:12-cv-916:

  1. Is the recorded lease of a severed subsurface mineral estate a title transaction under the Ohio Dormant Mineral Act, R.C. 5301.56(B)(3)(a)?
  2. Is the expiration of a recorded lease and the reversion of the rights granted under that lease a title transaction that restarts the 20-year forfeiture clock under the ODMA at the time of the reversion?

Read the court’s certification order and preliminary memoranda.…


Continue Reading →

Ohio EPA issues revised Model General Permits for oil and gas wells

Posted in Exploration & Production, Ohio, Refining, Regulatory

In February 2013, we reported that the Ohio Environmental Protection Agency (Ohio EPA) had issued proposed revisions to its Model General Permit for oil and gas well-site production operations. On April 4, Ohio EPA announced that it had finalized those revisions. The revisions bring the Model General Permits up-to-date with changes in the law since Ohio EPA originally issued the permits and make other changes to respond to industry comments. The revisions also include revised leak detection and repair requirements, which have been the subject of much recent discussion.

Ohio law generally requires each new source of air pollution to obtain a pre-construction permit from Ohio EPA’s Division of Air Pollution Control before “begin[ning] actual construction, erect[ing], locat[ing] or affix[ing] [the] air contaminant source.” Ohio law also requires sources of air pollution to obtain operating permits. Larger sources typically obtain permits-to-install (PTIs) and “Title V” operating permits; smaller sources typically obtain combined permits-to-install and operate (PTIOs). Ohio EPA may also develop Model General Permits — model PTIs and PTIOs — for categories of sources. Sources may choose to apply for regular PTIs or PTIOs if they like, but Model General Permits can be obtained more quickly, because, as Ohio EPA has explained, “all the terms and conditions of the permit have been developed in advance.”…


Continue Reading →

Ohio severance tax is a point of ongoing negotiation

Posted in Exploration & Production, Ohio, Tax issues

Ohio Gov. John Kasich’s mid-biennium review plan calls for an increase in Ohio oil and gas severance taxes, as proposed in House Bill 472. These increased taxes would fund certain local governmental initiatives and the Ohio Department of Natural Resources. They also would help offset personal income tax cuts outlined in the mid-biennium plan.

The current production-based severance tax scheme does not distinguish between production generated by conventional oil and gas wells and production generated by horizontal wells. The current severance tax under R.C. § 5749.02 is levied at a rate of $0.10 per barrel of oil and $0.025 per thousand cubic feet (MCF) of natural gas.

For conventional oil and gas wells, the tax under H.B. 472 would remain a volume-based tax but the rates would increase to $0.20 per barrel of oil and $0.03 per MCF of natural gas. The tax would be imposed on the “severer,” defined for conventional wells as the person who actually removes the oil or gas from the ground. Other changes to the state’s regulatory scheme are intended to militate against this tax increase, however, resulting in no economic change to the costs of production for conventional wells.1 Moreover, low-producing conventional wells would be completely exempt from the severance tax.…


Continue Reading →

An agreement to enter into an oil and gas lease is an enforceable contract in Ohio

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio

An agreement to enter into an oil and gas lease is an enforceable contract in Ohio

Landowner enters into an agreement to sign an oil and gas lease, finds outs there may be a better deal elsewhere and tries to get out of the first deal. A federal court in Ohio says, “No, a deal is a deal.” Bruzzese v. Chesapeake Exploration, LLC, U.S. District Court for the Southern District of Ohio, Eastern Division (Feb. 13, 2014).

Background

A group of landowners in eastern Ohio had engaged attorneys to negotiate oil and gas leases on their collective behalves. They signed an Agreement to Accept Lease Offer from Chesapeake Exploration, LLC. About 75 members of the group later sued Chesapeake Exploration, LLC, claiming that the agreement was unenforceable. Chesapeake settled with all the landowners except Stephen and Elizabeth Albery.

The Alberys had printed out the agreement, filled in blanks, signed it and emailed it to the group attorneys on July 16, 2011. Immediately thereafter, Mrs. Albery’s sister told them that she had heard that other energy companies were making better offers to landowners. Under the apparent understanding that they could back out of the agreement because they believed they could still opt out of the landowners group, the Alberys sent a letter to counsel on July 24, 2011, stating that they wished to terminate the agreement.…


Continue Reading →

The Ohio Dormant Minerals Act: Part 4

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Real Estate

In the previous three parts of this series (read part 1, part 2 and part 3), we reviewed the Ohio Marketable Title Act (MTA), its application to severed minerals, and the experience of neighboring states, all of which played a role in the development of the Ohio Dormant Minerals Act (DMA).

To summarize:

  • The MTA was enacted in 1961 to make land titles marketable, i.e., free of stale claims. It included a grace period and did not require notice before a chain of title was extinguished in favor of another.
  • The MTA generally applies to any property interest (presumably still including oil and gas interests) where no conveyance or claim to preserve has been filed during the past 40 years.
  • The MTA does not necessarily extinguish all old severed mineral interests, even those with a root of title more than 40 years old, because the severed interest may be a separate chain of title.
  • The Illinois DMA was found unconstitutional by the Illinois Supreme Court in 1980 as violating due process because it did not require severed mineral owners to be given notice and an opportunity to be heard.
  • Indiana’s Dormant Mineral Interests Act, Ind. Code §§ 32-5-11-1 through 32-5-11-8 (1976) — which includes a grace period, a 20-year use-it-or-lose-it attribute and no notice requirement — was held to be constitutional by the U.S. Supreme Court in 1982. Texaco, Inc. v. Short, 454 U.S. 516, 102 S. Ct. 781, 70 L. Ed. 2d 738, (1982)
  • Illinois enacted

Continue Reading →

The Ohio Dormant Minerals Act: Part 3

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Real Estate

In part 2 of this series, we reviewed the application of the Marketable Title Act (MTA) in a 1982 case involving a severed mineral interest and two independent chains of title. The Ohio courts appeared to struggle with the application of the MTA to the facts of that case. Courts and legislatures in neighboring states also struggled with how to handle dormant severed minerals. Those states’ case law and statutes played a role in the formulation of the Ohio Dormant Minerals Act, which was enacted in 1989 as part of the MTA. Examples of such influential laws and cases from Illinois and Indiana follow.

Illinois DMA held unconstitutional in 19801

In Illinois, at common law, once a mineral estate has been severed from the surface estate, it cannot be terminated by mere nonuse or abandonment. Uphoff v Trustees of Tufts College, 351 Ill 146, 155, 184 NE 213, 216 (Ill 1932). Thus, mineral interests can lie dormant, even through several transfers of title. This situation, over time, can result in missing or unknown owners. The difficulty in ascertaining and locating severed mineral owners had a substantial deterrent effect on would-be gas and oil developers.

The Illinois legislature responded by enacting the Dormant Mineral Interests Act in 1969. The act was intended to facilitate development of dormant oil and gas interests by permitting consolidation of mineral ownership in one person in instances where it had formerly been diffused among many unknown or missing persons. The act provided that …


Continue Reading →

Anti-assignment clause in oil and gas lease enforced

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio

In a case involving the assignment of oil and gas leases from one company to another, an Ohio appellate court enforced an anti-assignment provision in the original lease. Harding v. Viking Internatl. Resources Co., Inc., 4th Dist. Washington No. 13CA13, 2013-Ohio-5236.

The facts

The Hardings owned property in Washington County that was subject to three oil and gas leases signed by the prior property owners, their parents. All of the leases contained the following anti-assignment clause:

The rights of the Lessor may be assigned in whole or in part and shall be binding upon their heirs, executors and assigns. The rights and responsibilities of the Lessee may not be assigned without the mutual agreement of the parties in writing.

The original lessee, Carlton Oil Corporation, assigned the leases to Viking in 2011. Though the assignment was recorded, the Hardings were not parties nor did they provide written consent to the assignment. However, after the assignment, the Hardings completed and returned a W-9 form that Viking mailed to them and they accepted and cashed royalty checks from Viking for eight months before they objected to the assignment and filed suit against Viking to have the court declare the leases void and forfeited because of the violation of the assignment provision.…


Continue Reading →

The Ohio Dormant Minerals Act: Part 2

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Real Estate

In the first part of this series, we reviewed a 2010 Licking County case, which held that Ohio’s Marketable Title Act (MTA) extinguished an adjoining landowner’s claim against former railroad property. This article discusses how the MTA was used to reconcile competing claims to a severed mineral interest before Ohio’s Dormant Minerals Act was passed.

The Marketable Title Act and severed minerals: coal excepted, but not oil and gas

When the MTA was first enacted in 1961, it expressly excepted all mineral interests . But in 1973 the Ohio Legislature amended the mineral interest exception so that only coal was excepted from the operation of the MTA. That amendment set the stage for Heifner v. Bradford, 5th Dist. Muskingum No. CA-81-10, 1982 Ohio App. LEXIS 14859 (Jan. 29, 1982), overruled by Heifner v. Bradford, 4 Ohio St. 3d 49; 446 N.E.2d 440 (1983).…


Continue Reading →

Carroll County dormant minerals interest case — decision favors mineral owners

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio

We are in the process of posting a series of articles on the Ohio Dormant Minerals Act (DMA), in which we’ll provide analysis about Dahlgren-v-Brown, Carroll C.P., 13CVH27445, (Nov. 5, 2013). However, today we wanted to share news about this Carroll County opinion and what it may portend for future cases.

The facts

Leora Dahlgren owned severed minerals pursuant to a reservation in a deed to Walter Dunlap in 1949. When Leora passed away in 1977, her estate was probated and a Certificate of Transfer conveying the minerals to her heirs was issued and recorded — at the Probate Court rather than the Recorder’s Office — in 1978.1 More than 30 years later, in 2009, the mineral owners leased their oil and gas. During that same period of time, the surface had become owned by successors to Dunlap pursuant to deeds reciting the reservation in the 1949 deed. The surface owners filed a DMA notice of abandonment in March 2012. Within the following 60-day period, the Dahlgren mineral heirs filed their notice of claim and, in 2013, sued to quiet title.…


Continue Reading →

Sixth Circuit affirms “paragraph 14” lease interpretation

Posted in Exploration & Production, Mineral Interest, Real Estate

The right, but not the obligation, to renew an existing lease

As we discussed previously, state and federal courts in Ohio have been asked to interpret the meaning of “paragraph 14” in oil and gas leases. On Oct. 30, 2013, the Sixth Circuit Court of Appeals held that paragraph 14 does not require a lessee to match a third-party offer or have the lease terminated. The federal court opinion issued in Stewart v. Chesapeake Exploration, L.L.C., 2013 U.S. App. LEXIS 22302, 2013 FED App. 0928N (6th Cir.), 2013 WL 5832343 (6th Cir. Ohio 2013) is consistent with other holdings interpreting this lease provision.

The court found the landowners’ interpretation “strange at best,” “implausible” and in conflict with several other provisions in the lease.

The court closed by holding:

“In summary, we agree with the district court that, by its terms, Paragraph 14 does not grant the landowners a right to terminate their leases, but instead grants Chesapeake a ‘preferential right to renew’ them.”

 …


Continue Reading →

Ohio landowners challenge oil and gas leases; does the offer of a new lease terminate the existing one?

Posted in Contracts and Leases, Exploration & Production, Ohio

The plaintiffs in this case are a group of landowners in Nobel County who, from 2008 to 2010, entered into oil and gas leases, some of which were assigned to Chesapeake Exploration, LLC. Some of the leases had a three-year primary term, some five years, with typical provisions to extend the primary term. However, the lease provision really at issue was titled “Preferential Right to Renew,” referred to as “paragraph 14.” Both the plaintiffs and defendants filed motions for summary judgment. Judge Edmund A. Sargus Jr. of the federal District Court in Columbus decided the case on Sept. 26, 2013. Wiley v. Triad Hunter LLC, 2013 U.S. Dist. LEXIS 143058 United States District Court for the Southern District of Ohio, Eastern Division.

Paragraph 14 provides, in summary, that if during the primary term and one year thereafter, the lessor receives an acceptable, bona fide third-party offer to lease, the lessor would provide the lessee with the particulars. The lessee then would have 30 days to advise the lessor of its agreement to match the offer. Also, any lease “granted by lessor in contravention of the purposes of this paragraph shall be deemed null and void.”

The plaintiffs received a bona fide offer to lease their land. At this point, let me digress. Hoping that an existing lease will expire, third parties will offer a new lease to the landowner, sometimes called a “top lease,” that will take effect upon the existing lease’s termination. Paragraph 14 would seem to protect …


Continue Reading →

Lessors fail in an attempt to terminate — land held by a trust is subject to a valid oil and gas lease

Posted in Contracts and Leases, Exploration & Production, Ohio

For estate planning purposes, in 2005 Willard and Ruth Liggett put real estate they owned into a revocable trusts with themselves as trustees. In 2008, the Liggetts signed an oil and gas lease in their personal capacity. In 2012, Plaintiffs Willard and Ruth Liggett, co-trustees under 10/10/05 Liggett Trusts, filed a complaint in Tuscarawas County. The Lessee, Chesapeake Exploration, L.L.C., counterclaimed. The case was removed to federal court in Youngstown, Ohio. See Liggett v. Chesapeake Exploration, L.L.C., 2013 U.S. Dist. LEXIS 147392, United States District Court for the Northern District of Ohio, Eastern Division.

The Liggetts claimed the lease was unenforceable because it was signed by them personally, not as trustees, and asked for summary judgment. Chesapeake asked for a declaratory judgment that the lease is valid and enforceable, and filed counterclaims.

On Oct. 11, 2013, Judge Benita Y. Pearson ruled that the lease is valid and enforceable. Chesapeake’s motion for summary judgment for its claims against the Liggetts remain pending for trial. They are:…


Continue Reading →

What is an oil and gas lease? A federal court in Ohio predicts Ohio law

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio

An essential function of the law is to provide predictability as questions arise. When legal questions arise in the oil field regarding ownership rights, a consensus in the law — especially in the common law — is crucial. With that consensus, the attributes of conveyances related to those hydrocarbons (rights) can be examined. Specifically, what are the landowner’s rights with regard to the hydrocarbons under a piece of land in Ohio? Does he or she actually own them, or do they just have the right to capture them? If he or she would grant a lease to an oil company, what does the oil company own — is it an interest in real estate or is it simply a right to search? And, if found, what is the nature of the interest owned by the oil company pursuant to the lease? These fundamental questions have not been answered clearly in Ohio despite the fact that courts have struggled with them for over a century.

This ambiguity in the law puts federal courts in a potentially difficult position. Absent a clear indication of state law, federal judges deciding these issues under Ohio law are required to consider how the Ohio Supreme Court would decide the issue. Recently, a federal judge weighed in on the nature of an oil and gas lease in the case of Wellington Resource Group LLC v. Beck Energy Corporation, Case No. 2:12-CC-104 in the United States District Court for the Southern District of Ohio, Eastern Division, …


Continue Reading →

SEC will redraft, not appeal, district court rejection of resource extraction issuer payment disclosure rules

Posted in Exploration & Production, Securities

We wrote previously about the United States District Court for the District of Columbia vacating Securities and Exchange Commission Rule 13q-1, which required certain companies to disclose payments made to foreign governments in connection with the commercial development of oil, natural gas or minerals. The SEC announced Sept. 3, 2013 that it would not appeal the court’s decision and would instead redraft the rule, taking into account the court’s concerns, and restart the rulemaking process.

The court had found that:

  1. The SEC erroneously read the statutory language as requiring public disclosure of these payments; and
  2. The SEC’s decision to deny any exemption to the disclosure requirements, specifically in the case of countries that prohibit disclosure of these payments, was arbitrary and capricious.

The SEC has not provided a timetable for the redraft of the rule.…


Continue Reading →

Part 2: Who owns the minerals under Ohio Township Section 16?

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Real Estate, Regulatory

In our first post about Section 16 lands, we provided background on such public lands here in Ohio. We summarized that in 1785, a Federal land ordinance granted one square mile — usually Section 16 — out of every six square mile township to be held in trust by the state and to be dedicated to support public education pursuant to federal law. The Ohio Legislature then began leasing the land, and in 1827 it authorized sale of the land with proceeds going to the “Common School Fund.” Interest from the fund was to be paid to the schools within the townships. See, Dr. George W. Knepper, The Auditor of State, The Official Ohio Lands Book, 2002. (“Knepper”).

In regard to the funds collected from the sale of all school lands, the Ohio Constitution provided:

“The principal of all funds, arising from the sale, or other disposition of lands, or other property, granted or entrusted to this state for educational and religious purposes, shall forever be preserved inviolate, and undiminished; and, the income arising therefrom, shall be faithfully applied to the specific objects of the original grants, or appropriations.” Ohio Constitution, Article VI, Section 1 1


Continue Reading →

Ohio H.B. 59 — The Final Report: No New Severance Taxes But Operators May Have to Test for Radiation

Posted in Exploration & Production, Ohio, Regulatory, Tax issues

Whether oil and gas drilling poses a legitimate risk for exposure to radiation has been a hot topic of recent debate. Though we occasionally hear anecdotal evidence reported in the newspapers about radioactive drilling waste being rejected by landfills, there seems to be scant evidence that radiation is a common or serious oil and gas industry problem in Ohio. Nonetheless, the Ohio Legislature and Gov. Kasich recently passed new law that all horizontal well operators should understand.

On June 30, 2013, Gov. Kasich signed H.B. 59, the budget bill, into law. The bill created a new section of the Ohio Revised Code — R.C. 1509.074 — which imposes requirements for testing, transporting and disposing “material that results from the construction, operation or plugging of a horizontal well” that might contain unusual levels of radioactivity.

The new law generally requires operators to sample and test such material for Radium-226 and Radium-228, and to dispose of radioactive material “in accordance with all applicable laws.” However, the new law has several important exceptions. An operator of an oil and gas well is not required to perform sampling and testing if:…


Continue Reading →

District Court Vacates Resource Extraction Issuer Payment Disclosure Rules; May Foreshadow Ruling on Conflict Minerals Challenge

Posted in Exploration & Production, Securities

On July 2, 2013, the United States District Court for the District of Columbia vacated Securities and Exchange Commission (SEC) Rule 13q-1, which required certain companies to disclose payments made to foreign governments in connection with the commercial development of oil, natural gas or minerals. The court found:

  1. the SEC erroneously read the statutory language as requiring public disclosure of these payments; and
  2. the SEC’s decision to deny any exemption to the disclosure requirements, specifically in the case of countries that prohibit disclosure of these payments, was arbitrary and capricious.


Continue Reading →

Ohio Supreme Court Will Hear Appeal — Do ODNR Regulations Preempt Local Ordinances?

Posted in Exploration & Production, Ohio, Regulatory

The City of Munroe Falls filed an appeal from a decision of the Ninth District Court of Appeals, which held that some of the Munroe Falls ordinances were preempted by state legislation that vests authority to regulate oil and gas production in ODNR. We discussed the issue of preemption generally here, and summarized the earlier decision here.

Today, responding to jurisdictional briefs filed by the City of Munroe Falls and Beck Energy, the Ohio Supreme Court agreed to hear the appeal.

The parties will next file briefs, and we will keep you posted.

Readers who may wish to add their perspective to the issues pending before the Supreme Court in this appeal as “friends of the court” can refer to Rule 16.06 of the Supreme Court’s Rules of Practice, which addresses the filing of briefs of amici curiae.…


Continue Reading →

ODNR Issues New Rules for Unitization Applications

Posted in Exploration & Production, Ohio, Real Estate, Regulatory

Responding to a surge in applications, the Ohio Department of Natural Resources (ODNR) has issued rules for new applications. After being relatively unused for decades, the unitization statute (R.C. 1509.28) has found new life in the current shale play and the state agency overseeing the process decided it was time to lay down some groundrules.

The new rules mostly serve to clarify the statutory requirements, but there are few substantive additions that aren’t required by statute:

  • Affidavit of attempts to lease. Most notably, the new rules require applicants to describe their efforts to lease the remaining acres in a proposed unit. The operator must identify specific details of each attempt to lease the mineral rights, including the dates of the attempts and the names of people contacted. This has long been an aspect of mandatory pooling, and has been a part of recent unitization orders, but until now was not a prerequisite to apply for unitization.
  • Visual depictions of the proposed unit. The rules describe specific dimensions and content requirement for maps and aerial photographs of proposed units.
  • Description of geological formations. The rules require a gamma-ray density log depicting the geological formations to be drilled in the proposed unit.
  • Large exhibits at hearings. As the audiences grow at unitization hearings, the new rules require applicants to bring large visual exhibits depicting many parts of the application (including the maps and aerial photographs of the proposed unit, and depictions of the geological formation).

Check out the new rules at the …


Continue Reading →

Fifth Circuit Affirms $44.4 Million Jury Award for Trade Secret Misappropriation of Software Developed for Oil and Gas Industry

Posted in Exploration & Production

The Fifth Circuit Court of Appeals recently affirmed a jury verdict awarding $26.2 million in compensatory damages and $18.2 million in punitive damages for trade secret misappropriation of software that enabled oil and gas companies to “plan, procure and pay for complex services” online. See Wellogix, Inc. v. Accenture, LLP, Case No. 11-20816 (5th Cir. May 15, 2013). The Fifth Circuit stated: “Had we sat in the jury box, we may have decided otherwise. ‘But juries are not bound by what seems inescapable logic to judges.’ Morissette v. United States, 342 U.S. 246, 276 (1952).”

The case highlights the importance of taking steps to protect the secrecy of confidential and proprietary business information, including securing confidentiality agreements before sharing such information with other parties such as investors, customers and marketing partners. Because the plaintiff — Wellogix, Inc. — established that it had disclosed its proprietary software and technology to the defendant subject to a confidentiality agreement, it was able to meet its burden of showing that it had taken sufficient measures to guard the secrecy of its software and that the defendant had improperly relied on Wellogix’s software to pursue another business opportunity in breach of the parties’ confidential relationship.…


Continue Reading →

ODNR Releases 2012 Utica Shale Production Results

Posted in Exploration & Production, Ohio, Shale

Ohio law requires oil and gas operators to report prior year production from oil and gas wells on an annual basis — by March 31 of the following year. The Ohio Department of Natural Resources (ODNR) recently unveiled the 2012 production results from Ohio’s Utica shale play. These figures have been much anticipated by investors, land owners and the oil and gas industry, who are all trying to glean insights about the most productive areas and the overall potential of the play.

First, a Look Back at 2011

The first production from Ohio’s Utica Shale was realized in 2011 and reported on March 31, 2012. That data showed that merely nine Utica wells were in production during some part of 2011 — all drilled by Chesapeake Appalachian, LLC. Six of those wells were located in Carroll County. The remaining data came from wells in Portage, Harrison and Mahoning counties.

Though none of those nine wells were in production for all of 2011 (all but two were in production for less than six months), combined they still produced 2.56 billion cubic feet of natural gas and 46,326 barrels of oil, which amounted to 3.5% of the state’s overall gas production and 1% of oil production for that year. These are impressive statistics considering that Ohio had more than 50,000 conventional (vertical) wells reporting production in 2011.…


Continue Reading →

Common Oil and Gas Lease Conundrums

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Regulatory

Understanding rights and obligations associated with oil and gas leases can be challenging. Imprecise lease language, implied legal duties, formulaic statutes and evolving case law all affect oil and gas leases in different ways. We’ve written several articles on these topics during the past several months and have compiled them into an eBook to help bring clarity to some of these issues. Download our Common Oil and Gas Lease Conundrums eBook.…


Continue Reading →

Ownership of Minerals Under Adjoining Waters

Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Real Estate

This post is the first of two articles examining ownership of minerals located under bodies of water and roads.

Who owns the minerals under bodies of water? When oil and gas were being produced in meager quantities, not many people cared. But the story is different when lease bonuses are thousands of dollars per acre and royalties could be worth millions. Now, every acre in eastern Ohio is cast in a different light and suddenly there is enormous interest in figuring out who owns the minerals beneath Ohio’s lakes, rivers, ponds, streams and reservoirs. The following press release helps drive home the point about what is at stake:…


Continue Reading →