Has an oil or gas company come knocking at your door? There are all kinds of valuable mineral sources under the ground, and oil and gas companies are always looking for sources on private lands -- particularly in shale-rich Ohio where lots of rich mineral deposits are found. For a lot of people who aren't otherwise using their land, an oil or gas lease can be a welcome source of income.
When you agreed to let the oil or gas company lease your land a few years ago, the demand for oil and other natural minerals was going strong. Now, there's been a huge drop in demand and production is falling accordingly. Will the well on your property suddenly stop production and your royalty checks dry up?
"Shut-in" clauses are a source of confusion for many property owners who agree to an oil and gas leak.
If your first reaction after being contacted by an oil and gas company about developing the mineral rights on that old bit of family land is to celebrate, you can be forgiven. After all, who hasn't dreamed of finding a fortune on their property, Jed Clampett-style, at least once?
Ohio is rich in shale, and shale oil can be refined just like petroleum. In addition, the layers of shale sometimes capture large pockets of natural gas that can be harvested and used. It's no wonder that oil and gas companies often seek contacts with landowners that will allow them to develop those natural resources.
Ohio has played a big role in the oil and gas industry for decades. Over the past few years, coal and nuclear plants have been shutting down, but the Buckeye State has been growing its natural gas and shale contributions to replace them.
In the summer of 2019, Ohio passed a bill to save its nuclear power plants. According to Forbes, these plants account for 90% of the Buckeye State’s clean energy. Critics of the bill, however, point to the fact that this also preserved coal plants in the state. Supporters of the bill explain that this was a necessary compromise to get the bill to pass, but that coal was in decline and no new plants would appear in Ohio ever again.
Having an oil and gas company exploit your mineral interests on your property can be an exciting prospect since you can reap some of the proceeds. However, if you have no experience with oil and gas development in Ohio, you should consider taking some important initial steps in the event an oil and gas developer inquires about your oil and mineral rights. You can avoid some pitfalls and take advantage of important opportunities.
According to Forbes, private landowners own most of the undeveloped minerals in the country. To get access to these minerals in Ohio, these companies must frequently bargain with landowners. This makes them highly efficient and effective at getting what they want, while landowners do not have this experience. This tips the scales in the companies’ favor.
If you have ever tried to build a home in Ohio, you probably already know how much of a headache this can be. Local governments insist that zoning laws and building codes help to protect consumers from unsafe residences. Some regulations, however, have little to do with safety and more to do with preserving property values.