Iowa Surface Tenant's Subordination to An Oil and Gas Lease
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FAQ
The landowner may also be offered a non-surface use lease. Under this type of lease, the oil and gas company leases only the oil and gas rights, but does not obtain the right to use the land to develop the oil and gas.
A surface use agreement, which is also sometimes referred to as a land use agreement, is an agreement between the landowner and an oil and gas company or an operator for the use of the landowner's land in the development of the oil and gas.
No Surface Occupancy (NSO): A fluid minerals leasing constraint that prohibits occupancy or disturbance on all or part of the lease surface to protect special values or uses.
surface use lease allows the landowner to lease the oil and gas rights and obtain a bonus and royalty, while at the same time protecting the surface of the land.
These basic lease terms ? bonus, royalty, term, delay rental (if any) and shut-in royalty --are typically the "deal terms" negotiated between the Lessor and Lessee. The Lessor typically wants the highest bonus, delay rental and royalty fraction he can get, and the shortest primary term. The Lessee wants the opposite.
