Title: Texas Notice and Declaration of Gas Storage Provided For in Oil and Gas Lease: Explained Introduction: The Texas Notice and Declaration of Gas Storage Provided For in Oil and Gas Lease is a crucial legal document that outlines the storage provisions associated with an oil and gas lease agreement in Texas. This comprehensive guide provides a detailed description of this important document, exploring its purpose, key elements, and potential types. Key Elements of the Texas Notice and Declaration of Gas Storage: 1. Purpose: The primary purpose of the Texas Notice and Declaration of Gas Storage Provided For in Oil and Gas Lease is to establish the rights, obligations, and conditions related to gas storage activities within the leased property. This notice ensures clarity and transparency for both the lessor (property owner) and the lessee (oil and gas company). 2. Definitions: The document contains definitions of important terms associated with gas storage, including "gas storage facility," "working capacity," "injection," "withdrawal," and others. These definitions help to avoid any misunderstanding or ambiguity during the lease term. 3. Storage Rights: The notice defines the rights granted to the lessee for gas storage within the leased property. It specifies the maximum working capacity of the storage facility and any limitations or restrictions associated with the storage operations. This section clarifies the permitted purposes for storing gas and whether third parties are allowed access to stored gas. 4. Obligations and Responsibilities: The document highlights the obligations and responsibilities of both the lessor and the lessee regarding gas storage activities. These may include maintaining the integrity of the storage facility, complying with safety and environmental regulations, and providing advance notice of any significant modifications to the storage operations. 5. Royalties and Compensation: The notice outlines the mechanism for determining royalties and compensation associated with gas storage. It may specify the payment or royalty rates, the frequency of payments, and any adjustments based on gas storage volumes. Types of Texas Notice and Declaration of Gas Storage Provided For in Oil and Gas Lease: 1. Primary Storage: A primary storage notice allows the lessee to store gas within the leased property without restrictions or limitations. The notice typically grants exclusive rights to the lessee and covers a specified storage capacity. 2. Limited Storage: A limited storage notice restricts the lessee's storage rights to a specific volume or limited time frame. This type of notice may be used when the lessor has concerns about the extent or duration of gas storage on their property. 3. Shared Storage: A shared storage notice allows multiple lessees to share the storage facility and its capacity. It establishes the rights, responsibilities, and arrangements for cooperation between lessees regarding access, operations, and royalty sharing. Conclusion: The Texas Notice and Declaration of Gas Storage Provided For in Oil and Gas Lease is a vital legal document that ensures the proper regulation and consent for gas storage activities within an oil and gas lease agreement. By defining rights, obligations, and responsibilities, this notice protects the interests of both lessors and lessees. Understanding the various types of notices can enable parties to negotiate and establish the most suitable terms for their gas storage operations in Texas.
Texas Notice and Declaration of Gas Storage Provided For in Oil and Gas Lease
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Granting Clause: The clause in the deed that lists the grantor and the grantee and states that the property is being transferred between the parties.
in clause (or shutin royalty clause) traditionally allows the lessee to maintain the lease by making shutin payments on a well capable of producing oil or gas in paying quantities where the oil or gas cannot be marketed, whether due to a lack of pipeline connection or otherwise.
Section 91.504, Texas Natural Resources Code, gives an owner of a royalty interest in oil or gas produced in Texas the right to request from a payor information about itemized deductions, the heating value of the gas, and the Railroad Commission of Texas identification number for the lease, property, or well that may ...
What is the granting clause? The granting clause is the clause under which the owner of the oil and gas rights leases the oil and gas rights to the oil and gas company along with the right to develop the oil and gas on a specifically described piece of real estate.
A Pugh Clause is enforced to ensure that a lessee can be prevented from declaring all lands under an oil and gas lease as being held by production. This remains true even when production only takes place on a fraction of the property.
A clause in an oil & gas lease that provides that if the leased land is later owned by separate parties, such as in a sale of part of the property, the lessee can continue to operate, develop, and treat the lease as a whole and pay royalties to each owner based on its percentage of ownership of the entire area.
Oil leases are agreements between an oil and gas company known as the lessee and mineral owners known as a lessor, in which the lessor grants the lessee the permission to explore, drill, and produce those minerals for a specified period known as a primary term or as long as the minerals continue to be productive.
A Pugh Clause is enforced to ensure that a lessee can be prevented from declaring all lands under an oil and gas lease as being held by production. This remains true even when production only takes place on a fraction of the property.
