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Lease Expiration Claims

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Throughout Pennsylvania there are oil and gas leases of record that were signed over hundred years ago.  Are these leases still valid?  How can a modern driller rely on an oil and gas signed in 1913?  These questions are asked by frustrated landowners every day.  Oil and gas leases can, and do, expire.  However, it is sometimes up to the landowner to take affirmative action and remove these ancient instruments from the chain of title.  The Oil and Gas Practice Group at Houston Harbaugh has significant experience in litigating lease expiration claims on behalf of landowners.

Oil and gas leases frequently provide for a “primary term” of a set duration which gives the oil and gas driller time to explore for and begin to produce oil and gas.  Primary terms are typically five (5) years.  At the end of the “primary term”, the lease may transition into a “secondary term” and will remain in effect so long as oil and gas is produced “in paying quantities”.  This essentially means that the lease will remain in effect so long as the leasehold is producing oil and gas and generating some profit.  The secondary term can last for 100 years. However, if the leasehold fails to produce oil and gas in sufficient quantities, an argument can be made that the lease automatically terminated and expired. Questions often arise regarding whether an oil and gas operator has satisfied the lease requirements to maintain the lease in effect past the end of the “primary term”. At other times, there are questions about whether an oil and gas operator is complying with the lease requirements during the “secondary term”. If you believe that an oil and gas operator has failed to comply with the terms of your oil and gas lease, the Oil and Gas Practice Group at Houston Harbaugh can assist you in evaluating whether that the oil and gas lease has terminated and what corrective measures need to be taken.  We know lease expiration claims.  Let our experience work for you.

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