0 – 15 Minutes
Temporary Work Space Agreement Show and other important natural gas development topics. Reminder for the Clark Law Firm free landowner seminar on June 15th at the Dean’s Center in Wellsboro, Tioga County. There is a strong need for Pennsylvania landowners to get legal assistance from an experienced oil and gas lawyer prior to entering into any oil and gas agreement. Landowners must not rely on the gas and pipeline company landmen to educate them. We have the opportunity to learn from the past mistakes of others and the evolution of the oil and gas industry in Pennsylvania. Doug discusses the value of learning from experience from negotiating oil and gas agreements and observing natural gas development trends. Explanation of the gas right owner benefit from an initial review and consultation regarding any gas or pipeline agreement offer. Landowner should take advantage of quality free natural gas development information at pagasleasattorney and pipelineattorney.
15 – 30 Minutes
Doug again delves into the landowner’s “Option Agreement Dilemma”. Explanation regarding how option agreements operate and how the gas or pipeline company have an option period to decide whether to exercise the “option” to use the agreement. Surface owners and gas rights owners must negotiate to obtain the highest upfront option payment and negotiate to maximize the payment due upon the company’s decision to exercise the option. You must seek to avoid a situation where you lose money by signing an oil and natural gas option agreement. Explanation of how companies use option agreements and the option dilemma to induce landowners to sign bad contracts for landowners. Option Agreements must be carefully scrutinized and negotiated upfront to guarantee a sufficient option payment to cover legal fees for an experience oil and gas lawyer. Never rely on the gas or pipeline company landman to negotiate on your behalf – they work for the company!
30 – 45 Minutes
Regardless of the type of agreement presented, the landowner must have the two immediate fundamental goals to:
(1) Maximize the upfront Option Payment to cover attorney fees and expenses; and
(2) Maximize the Exercise of Option Payment to obtain as much money as possible to secure the highest payment possible in the event the company exercises the option and uses the Option Agreement for development.
A breakdown of a sample Temporary Work Space Agreement. Doug reads through an actual Temporary Work Space Agreement recently presented to a Clark Law Firm client and explains numerous problematic issues for the landowner. How vague and broadly worded agreements often present enormous company loopholes. Landowners must negotiate not only for damages and compensation payments, but must also negotiate addendum provisions or additional terms to the contract. Agreements should seek to define time frames, termination dates, authorized areas for operation defined by a map, relief from future tax issues, liability protection through Indemnification provisions and much more.
45 – 60 Minutes
Doug continues to thoroughly breakdown a Temporary Work Space Agreement presented to a landowner client. It is critical that any important verbal representation made by a landman be added to the actual written agreement. Verbal or oral representations are not part of the agreement and you will not be able to argue verbal statements by the landman in the future. Get all important terms and issues in writing. Watch out for assignment provisions in agreements. Temporary Work Space Agreements can be leased, sub-leased or assigned to a third party (other energy and pipeline companies). The landowner’s property may become a major staging area that they never contemplated and this situation can occur for many years or decades. Landowners must protect themselves from liability and law suits and detailed indemnification provisions must be added to the agreement. Also, many landowners are entering into agreements that will have negative tax consequences and you must use addendum language to protect yourself from future increased taxes. Stop simply signing and get high experienced quality oil and gas lawyer representation and assistance.