This is the second post in a two-part series examining ownership of minerals located under bodies of water and roads. See part I discussing the ownership of minerals under adjoining waters. Who owns the minerals underneath public roads in Ohio? This is really two questions: What ownership interest does the state, county, or township have… Continue Reading
Category Archives: Real Estate
Subscribe to Real Estate RSS FeedOwnership of Minerals Under Adjoining Waters
Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Ohio, Real EstateThis 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… Continue Reading
Gaining Perspective on Ohio’s Oil and Gas Laws
Posted in Mineral Interest, Ohio, Real Estate, RegulatoryOhio’s oil and gas industry has been around for more than 120 years. That means there is plenty of perspective, and precedent, to consider when applying Ohio oil and gas law to the Utica and Marcellus shale plays. We’ve compiled a few Oil & Gas Law Report articles into an eBook to help you build… Continue Reading
Ownership Theory of Oil and Gas Influences Bankruptcy Law in Ohio
Posted in Contracts and Leases, Mineral Interest, Ohio, Real EstateOne of the most fundamental questions in oil and gas law is whether oil and gas in the ground are capable of being “owned.” The answer to this question shapes the law and influences legal analysis in a variety of ways. Different states have answered this question in different ways, and the answer is not… Continue Reading
Unitization in Ohio: Compelled Participation in the New Context of the Utica Shale
Posted in Contracts and Leases, Exploration & Production, Ohio, Real Estate, RegulatoryIn many ways, the Utica Shale play caught Ohio off guard. The state became a main focus of the oil and gas industry almost overnight. Ohio responded by updating its oil and gas laws, including major overhauls resulting from Senate bills 165 in 2010 and 315 in 2012. But in some cases, operators and regulatory… Continue Reading
Financing in the Energy Sector: A Primer for Lenders
Posted in Contracts and Leases, Ohio, Real EstateOur colleagues at the Banking & Finance Law Report recently ran a four-part series on energy financing. They compiled those articles into a resource that’s relevant to anyone involved with lending or borrowing in the energy sector. We encourage you to download the Energy Financing eBook to enhance your understanding of lending in the oil… Continue Reading
Oil and Gas Rights — Reserved? A Litigator’s Perspective On The Mong Case
Posted in Contracts and Leases, Ohio, Real EstateA decision out of the Eleventh District Court of Appeals of Ohio, Mong v. Kovach Holdings, LLC, 2013-Ohio-882 (Ohio 11th Dist. March 11, 2013), represents a cautionary reminder that parties should carefully review the language of contracts they enter, especially the essential terms of the document, and especially contracts that convey away property rights. That… Continue Reading
Life Estates: More Oil and Gas Law Implications
Posted in Contracts and Leases, Ohio, Real EstateWe recently received a question regarding our earlier post Life Estates: Oil and Gas Law Implications, wondering: “What happens to a mineral lease which the life tenant entered into and received renewal payments each year that was never ratified by the remaindermen upon the termination of the life estate and complete possession is realized by… Continue Reading
Be Careful Drafting Contracts and Deeds When the Ownership of Minerals Is at Stake
Posted in Contracts and Leases, Mineral Interest, Real EstateA recent decision by the Court of Appeals of Ohio highlights several errors by a seller of property who may have intended to reserve mineral rights. (See Mong v. Kovach Holdings LLC, 2013 Ohio 882, Court of Appeals of Ohio, Eleventh Appellate District, Lake County, March 11, 2013.) Facts In August 2009, McMenamin conveyed real… Continue Reading
What Goes Up … A Quick Glance at Ohio Oil and Gas Leases in Bankruptcy
Posted in Mineral Interest, Real EstateAs Ohio enjoys its latest boom in oil and gas exploration, it is important to understand how oil and gas leases are treated in bankruptcy. Unsettled Ohio law regarding whether a debtor owns unextracted oil and gas as part of the debtor’s real property can make this a difficult issue. In In re Loveday, No. 10-64110,… Continue Reading
A Tool of Last Resort: Mandatory Pooling in Ohio
Posted in Contracts and Leases, Exploration & Production, Ohio, Real Estate, RegulatoryThis is the second in a multi-part series on the practice of compelled participation – forcing unwilling mineral rights owners to participate in oil and gas production from their property. Part I discussed the history and constitutionality of this practice in the U.S. Every day, crowds of title researchers and landmen pack county offices in… Continue Reading
House Bills 59 and 72 Propose Changes to Ohio Oil and Gas Law
Posted in Ohio, Real Estate, Regulatory, Tax issuesThe Ohio 130th General Assembly is considering two new bills, House Bills 59 and 72. Each bill proposes changes to Ohio’s oil and gas law. Following is a summary of the proposed changes relevant to Ohio’s oil and gas law in each bill. House Bill 59 On Feb. 12, 2013, Rep. Amstutz (R-Dist 1) introduced House Bill 59,… Continue Reading
When Is an Assignment of a Lease not an Assignment of Obligations?
Posted in Contracts and Leases, Exploration & Production, Mineral Interest, Real EstateWhen oil companies transfer oil property among themselves, they frequently do so by an assignment of lease rights. Sometimes they assign all their interest under a lease, but they often assign just a portion of the lease, or reserve some interest in the property. In the event of multiple assignments — such as when party… Continue Reading
Mandatory Pooling and Unitization in Ohio, Part I: History and Constitutionality
Posted in Contracts and Leases, Mineral Interest, Ohio, Real Estate, RegulatoryLandowners, in certain situations, can be compelled by the state to combine their mineral interest with their neighbors for the purpose of producing oil and gas. In Part I of a multi-part series, I explain the history and constitutionality of this practice. What is Compelled Participation? “Compelled participation” is the term I will use throughout… Continue Reading
Who Owns the Mineral Rights on My Property?
Posted in Contracts and Leases, Mineral Interest, Ohio, Real EstateAs oil and gas companies flock to eastern Ohio to take advantage of the Utica shale play, trying to figure out “who owns the mineral rights” continues to be a difficult and increasingly important question. As noted in a recent post, Ohio title insurance companies are excepting from title insurance policies the ownership of the… Continue Reading
Is Gas a Mineral?
Posted in Contracts and Leases, Mineral Interest, Real EstateA case pending before the Supreme Court of Pennsylvania considers a question that seemingly has been settled in that state for 130 years: Is gas a mineral? In Butler v. Charles Powers Estate, Pennsylvania’s highest court will consider whether rights to natural gas produced from the Marcellus shale should qualify as “mineral” rights under an… Continue Reading
Kansas Reverses Course; Royalty Interests Reserved in the Grantor Vest Immediately
Posted in Mineral Interest, Real EstateThe Supreme Court of Kansas recently decided an interesting oil and gas case. The opinion in Rucker v. DeLay, 289 P.3d 1166, (Kansas, Oct. 19, 2012) contains an intriguing analysis of future royalty interests vs. mineral interests. Though the decision has interesting legal implications, it should be a practical lesson for those trying to convey… Continue Reading
Life Estates: Oil and Gas Law Implications
Posted in Contracts and Leases, Mineral Interest, Ohio, Real Estate, Tax issuesLife estates have been recognized as an interest in land at common law since the Middle Ages. Even so, how they relate to the ownership of and payment for oil and gas can result in outcomes that may not be intuitive. According to common law and statute, there can be no gap in the perpetual… Continue Reading
Lawsuits Over “Fraudulent” Oil & Gas Leases Often Lack Merit
Posted in Contracts and Leases, Real Estate, Regulatory, Shale, UncategorizedThe Ohio shale boom started slowly when a few small companies quietly began acquiring mineral leases for as little as $25 per acre. This soon gave way to a full blown land rush in the fall of 2010. But as lease prices skyrocketed through the Fall of 2011, disillusioned lessors who signed before the peak… Continue Reading
Ohio House Considers Proposed Legislation To Change Ohio’s Oil and Gas Regulations [UPDATE]
Posted in Mineral Interest, Ohio, Real Estate, RegulatoryThis week the Ohio legislature takes on a busy legislative schedule after the holiday break. Among the many pieces of legislation getting attention are five bills pertaining to the oil and gas industry. These bills, all of them Democrat-sponsored, are up for hearing before the House Agriculture and Natural Resources Committee this week. While no… Continue Reading
Oil & Gas Terms… Confused? You aren’t the only one
Posted in Mineral Interest, Ohio, Real Estate, Regulatory, ShaleThe terms “pooling” and “unitization” are often used interchangeably. To confuse the matter further, in Ohio, there are statutory definitions for a “pool” and a “drilling unit” and neither is related to a “unit.” Hopefully, this will provide some clarification. Pooling and Unitization, Generally To “pool” [the verb] is to combine multiples into a common… Continue Reading
Protecting (or Defeating) Mechanics’ Liens on Oil and Gas Projects
Posted in Labor, Pipelines, Real EstateAnyone familiar with the construction industry is aware that contractors and suppliers can protect their right to obtain payment on the project by filing a mechanics’ lien on the property. Those same protections are also available for companies working on the construction of oil and gas wells and pipelines. However, oil and gas projects are… Continue Reading
Conveying Fractional Mineral Interests – The Duhig Rule
Posted in Contracts and Leases, Mineral Interest, Real EstateLast month, we posted about issues that can arise when a landowner conveys or reserves a fractional mineral or royalty interest. In addition to questions about the amount of the interest an imprecisely drafted document conveys or reserves, previously granted or retained fractional interests can create conveyancing issues as well. Consider the following scenario: Suppose… Continue Reading
Is There a Right To Appeal an Oil and Gas Drilling Permit in Ohio? [UPDATE]
Posted in Contracts and Leases, Ohio, Real Estate, RegulatorySurface owners, neighbors and others indirectly affected by the issuance of an oil and gas well drilling permit might be surprised to learn that they do not have a clear right to challenge the terms contained in that permit. But, recent cases in Ohio and West Virginia have forced courts to more clearly define who… Continue Reading