0 – 15 Minutes
Doug discusses oil and gas lease termination language and when do gas leases terminate.  What is “held by production” and how can I tell if my gas lease has ended?  Doug discusses what energy companies and drilling companies have to do to continue a gas lease beyond the primary term.  Can a natural gas company park a truck on my property or must they drill and pay me royalties to extend my lease, or is the answer somewhere in the middle.  Doug breaks down a typical 5 year gas lease and when a lease will terminate or continue beyond 5 years.  Doug also begins the Pugh Clause discussion and how non-unitized acreage can be released under certain circumstances.

15 – 30 Minutes
Doug dives deep into a sample Pugh Clause and how a natural gas lease may terminate in the entirety or when a portion of the lease may terminate while other portions of your property or gas rights may be maintained or held by the drilling company under the terms of your lease.  Doug walks the landowner through how Pugh Provisions apply and what obligations the landowner or gas rights holder has to assure the acreage not held under the gas lease is “released” and returned to the landowner to either re-lease or hold off to explore options.  Most landowners are not aware when their Pugh Clause kicks in and the company does not meet the standard addendum clause requirement that they can write a certified letter to the leasing company to release acreage not held by the existing gas lease.

30 – 45 Minutes

Doug goes even deeper into Pugh Provision Addendum language and explains how leasing companies often offer modified Pugh Clauses that can be very tricky to follow and understand.  However, it is extremely important for all natural gas rights holders to fully understand their oil and gas lease and to recognize whether they have a pure or modified Pugh Provision that may result in the “release” of a portion of their property that is not held or in the process of being developed.  Almost all Pugh provisions place the burden on the landowner and gas rights holder to notify the gas company that the lease has not held all of their acreage and demand that the company file a formal “Release” at the county courthouse to return acreage that is not still subject to the existing gas lease.  Landowners and gas right holders must act affirmatively to have their acreage released and must not rely on the gas company to release non-developed acreage.

45 – 60 Minutes
Doug explains how Pugh Clauses may create an excellent opportunity to improve the existing oil and gas lease terms.  Doug explains depth severance provisions and vertical Pugh provisions and how landowners with depth severance language may be able to write the company and have deeper geological formation released so that they may enter into new leases in the future for deeper rock formations.  For example, some oil and gas leases allow the company 5 years to drill and then limit the company in the future to the deepest depth the company drilled in the 5 year term.  If you have this language and the drilling company only drilled to the Marcellus Shale formation, the company would be precluded from drilling a Utica Shale well unless the landowner signs additional documentation.  All landowners must fully understand whether they have a pure or modified Pugh Clause and whether they have depth severance language.  These clauses and depth severance provisions can be a huge windfall for the landowners and they cannot be overlooked, especially when companies have halted drilling in a down natural gas price market.  All landowners must seize all opportunities and seek qualified independent assistance to represent their important rights.