California Oil and Gas Law Blog

If you plan to lease your land for the purpose of oil extraction in California, there are several heavy considerations you must make before signing on the dotted line. Your contract with the oil and gas company should address those considerations. Though every case is unique, and though you should always consult with an attorney before signing over the rights to your property, PennState details several components that all oil and gas lease contracts should include.

According to the paper, you and your attorney should first determine the actual length of the lease. This may not be as cut-and-dry as you might think. Depending on the language of the contract, the length of the lease may be the primary term of the lease, which is typically five years, or it may extend into a secondary term so long as production is still active. If a secondary term is necessary, it is usually as long as the primary term.

We have focused on many aspects of oil and gas disputes on this blog, such as some of the reasons why business owners find themselves in the middle of a disagreement. As the owner of an oil and gas company, you should also think of the potential consequences associated with a dispute. Aside from financial headaches, you may face serious and potentially long-term complications depending on how the dispute plays out in court. Across the state of California, it is pivotal for oil and gas company owners to be prepared for these setbacks.

Regardless of the factors that have led to a dispute, the way in which your company handles this difficult situation could have an impact on the future of your firm. Sometimes, disputes can be resolved relatively effortlessly and simply communicating with those involved in the dispute can help reduce tensions and settle the disagreement. This is certainly not possible in every dispute and some can be extremely contentious, with very strong emotions and even negative media coverage.

If you have the potential to collaborate with other entities and participate in a gas lease, the opportunity may sound incredibly promising when you hear about the potential benefits. However, doing your research before agreeing to any type of contract is imperative to protecting your assets. At Ehrlich, Pledger Law, LLP, we have helped many land owners in California to understand more about their rights in preparation for signing a contract. 

Going into a potential contract deal in regards to a gas lease, you can never ask too many questions. Your vigilance and interest in finding out exactly what you are getting involved in may potentially be the difference in a successful agreement versus one that completely takes advantage of your assets. According to dojmt.gov, to begin, you should take your time to get to know the entity who is requesting a contract deal. Ask around about them and pay attention to what people are saying. 

While drilling natural resources in California can provide a variety of economic benefits, if regulations are not followed, it can pose an immediate threat to the environment, as well as the people and wildlife that live nearby. As such, regulations are put into place to protect the investment of the drillers, as well as the safety and well-being of people who reside near the drilling site. 

In Colorado, lawmakers are working hard to modify previously written agreements to tighten restrictions on various drilling procedures. They say that their underlying intention is to put a greater distance between drilling sites. Additionally, they hope to maintain a considerable distance between drilling sites and the people who live within that radius. While there has been interest and support for the suggested changes, both have failed to make any kind of voting ballot in recent years. Opponents voiced concern about how such restrictions would affect economic performance, as well as how it would impact the number of people who would potentially be jobless. A recent surge in activity has put Colorado at number seven for states with the largest presence of natural gas exploration.