Consent to Assign — A Scourge Upon Your Lease
As landmen in the field, an often mentioned request by mineral owners is that the lease not be assignable without consent of the lessor. On the surface this is a perfectly reasonable request, because Mr. Johnny just wants to make sure that he knows who holds his lease and that they are good folks. Unfortunately this clause can cause all sorts of heart burn later down the road. Most legal departments draft this clause with a caveat, “such consent will not be unreasonably withheld.” Unfortunately most leases don’t define the word ‘unreasonable’, and there are a multitude of perfectly reasonable-reasons ...
Book Review: Oil and Gas Title Examination
So I’ve spent the last several weeks digesting a book by George J. Morgenthaler, Oil and Gas Title Examination. The book is designed for attorneys who prepare title opinions, but it will be very useful to the experienced title researcher. When a title researcher understands what a title examiner is looking for, it will assuredly help them to deliver a higher quality product. When you purchase the book you will have the option of receiving an e-book version or a hard-bound copy. I reviewed the hard-bound book, and I was particularly impressed with the quality of the printing and binding. ...
Continuous Drilling, Operations, and Development – What’s the Difference?
There are so many lease provisions that can be thrown into an agreement that often times the meanings can become skewed. More often than not, they can even mean different things to different people. It’s important to communicate with the other party to determine the intent, and ensure that the language conveys the intent of both parties. So, as the start of my series exploring various lease provisions I’m going to discuss continuous drilling, continuous operations, and continuous development. The truth is that all three of these clauses are savings clauses, and are therefore very similar in application. Generally speaking, ...
Have You Gone to Work at 2 AM?
If you are currently working in Tyler County, West Virginia you might be heading to work at 2 AM. My friend Angela Perkins recently mentioned on LinkedIn the troubles with space in the records room in the county: A nightmare in Tyler County WV! So far, we have been threatened by those who are “standing in” for others, and then leave 10-15 minutes, exchanging places with those who were home sleeping, or staying in close buildings, sleeping on cots before the court house opens. The bulk of us, drive 1-2 hours to work, only to find that at 2 am, ...
Does Your Client Know What A Pugh Clause Is?
Now, I know you are all reading this because you said “of course everyone who isn’t a moron knows what a pugh clause is.” However, after an interesting discussion on LinkedIn (see here) several months back I began specifically asking my clients how they defined a vertical and horizontal pugh clause. I got more than one answer, and it opened my eyes to a way that one could easily make mistakes for their client. Why? Because the ‘old’ way most companies (and many still do) defined a vertical pugh is as a depth severance after the primary term. Likewise, they ...
