In our last post, we discussed the basics of the Oil and Gas Lease. Today we will discuss some of the finer points, provisions, and clauses of the lease.
Granting Clause: Usually, the opening paragraph of the lease is the granting clause. It outlines the purposes of the lease and describes the substances that can be explored and produced.
Duration: Both the Primary and Secondary Terms were discussed in yesterday's post and will not be rehashed here. However, there are three important provisions that should be discussed.
Royalty Clause: Again, discussed yesterday.
Surface Damages: Unless stated otherwise, the granting of an oil and gas leases carries the implied right to use as much of the surface as in reasonable necessary for the development of the minerals. This is because the surface estate is subservient to the mineral estate.
Pooling Clause: A provision giving the lessee the right to consolidate the leased premises with adjoining leased tracts in order to meet the requirements for the state mandated size for drilling and spacing units. Pooling, both compulsory and voluntary, will be covered in a post at a later date.
Assignment Clause: A provision permitting the lessor and the lessee to assign their rights under the lease to other parties.
Warranty Clause: A clause requiring lessors to defend their interest in, or title to, the leased premises.
Force Majeure Clause: The clause that protects the lessor from liability and loss of the lease whenever an "Act of God" causes the lessor to suspend operations. These acts can range from a tornado to a terrorist attack to the unavailability of a drilling rig.
More to follow.
BR
Berlin Royalties buys Oklahoma minerals and royalties, and we show you the work behind every offer. Free, no obligation, and if keeping them is the right answer we will tell you that too.
Get a Free Valuation or call or text 918-984-1645In a hurry? Text a photo of a royalty check stub to 918-984-1645 and our preliminary offer puts a written number in front of you within about two business days. It holds for 7 while you decide.
How an option to extend an Oklahoma oil and gas lease is exercised (certified mail and an affidavit of extension), and how a new lessee should protect itself.
Why an Oklahoma oil and gas lease says "Ten and more Dollars" instead of the real bonus. The granting clause is industry standard, not a sign of a scam.
The basics of an Oklahoma oil and gas lease: lessor and lessee, cash bonus and royalty (1/8th or 3/16th), primary and secondary term, and the legal description.
$7.8 billion of Haynesville deals in 2026, 57 rigs, and a midstream shuffle. What consolidation, takeaway, and deferred turn-in-lines do to a royalty owner's check.