Pugh Clause
Overview of this form
A Pugh Clause, also known as a Freestone Rider, is a provision added to an oil and gas lease that serves to limit the duration of the lease specifically to the pooled acreage. This rider is crucial for lessors seeking to sever the pooled acreage from the rest of the land under lease, ensuring that production on the pooled area alone maintains the lease. This form allows for tailored adjustments to the standard lease terms based on specific concerns of the lessor, differentiating it from other lease provisions.
Main sections of this form
- Pugh Clause designation: Identifies the specific clause being added to the lease.
- Pooling provisions: Specifies how pooled acreage affects the entire lease duration.
- Severance terms: Details the vertical and horizontal severance of acreage.
- Delay rental payment terms: Addresses conditions under which rental payments maintain the lease.
- Particular lease maintenance references: Covers additional conditions for lease validity.
When to use this document
This form is utilized when entering into an oil and gas lease and you want to impose specific limitations on the pooled acreage. It is particularly important if you have concerns about long-term lease obligations while only a portion of the land is actively producing. Consider using this form if you wish to ensure that operations on the pooled land preserve the lease, without extending the lease terms unnecessarily over non-producing areas.
Intended users of this form
- Lessees negotiating leases for oil and gas exploration.
- Property owners who want to protect their land from automatic lease extension during non-production.
- Landowners engaged in lease transactions who have specific conditions or limitations in mind.
- Legal professionals advising clients on oil and gas leasing agreements.
How to prepare this document
- Identify all parties involved in the lease agreement.
- Specify the property and acreage subject to the lease.
- Enter details of the pooling agreements and how it affects lease duration.
- Add any special conditions or limitations regarding production and operations.
- Sign and date the form to finalize the agreement.
Is notarization required?
This form does not typically require notarization to be legally valid. However, some jurisdictions or document types may still require it. US Legal Forms provides secure online notarization powered by Notarize, available 24/7 for added convenience.
Get your form ready online
Our built-in tools help you complete, sign, share, and store your documents in one place.
Make edits, fill in missing information, and update formatting in US Legal Forms—just like you would in MS Word.
Download a copy, print it, send it by email, or mail it via USPS—whatever works best for your next step.
Sign and collect signatures with our SignNow integration. Send to multiple recipients, set reminders, and more. Go Premium to unlock E-Sign.
If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
We protect your documents and personal data by following strict security and privacy standards.
Make edits, fill in missing information, and update formatting in US Legal Forms—just like you would in MS Word.
Download a copy, print it, send it by email, or mail it via USPS—whatever works best for your next step.
Sign and collect signatures with our SignNow integration. Send to multiple recipients, set reminders, and more. Go Premium to unlock E-Sign.
If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
We protect your documents and personal data by following strict security and privacy standards.
Common mistakes
- Failing to clearly specify the pooled acreage can lead to legal ambiguities.
- Not including all required parties to the agreement, which may invalidate the lease.
- Overlooking local regulations that could affect the enforceability of the Pugh Clause.
Benefits of using this form online
- Convenient access to legal templates tailored to specific lease agreements.
- Easy to edit and customize for individual needs.
- Reliability and assurance from forms created by licensed attorneys.
Legal use & context
- The Pugh Clause is legally recognized and enforceable in oil and gas lease transactions.
- Having clear pooling terms protects landowners from unwarranted lease extensions.
- Properly drafted clauses can help mitigate disputes between lessors and lessees.
Summary of main points
- A Pugh Clause is essential for defining the scope of lease obligations related to pooled acreage.
- Utilizing this form helps protect your interests when entering lease agreements.
- Proper completion and understanding of the clause can prevent future legal complications.
Looking for another form?
Form popularity
FAQ
A vertical Pugh Clause could provide a lease to a particular depth, such as 100 feet below the drilled well. The lessee would be limited to drilling to 100 feet but no further. Conceivably, the lessor could lease property below that range to another entity.
In general terms, the Pugh Clause provides that production from a unitized or pooled area located on or including a portion of the leased lands will not be sufficient to extend the primary term for the entire leasehold.
