Gas Leases

All my news lately seems to be coming from New York, so to add to the list…

The New York state Attorney General’s office has issued eight tips for minimizing the risk of signing a natural gas lease. Property owners in Sullivan County are now being offered land leases on their property by drilling companies.

Assistant Attorney General Michael Danaher said they frequently hear from landowners who thought they had a good deal, only to get hit with surprises later on.

That’s where one of the oldest pieces of advice comes into play: Put it in writing. “Put it in the lease. Go by the axiom: If it isn’t in the lease, it’s not going to happen. Make sure everything gets put in there. There are no handshake deals when it comes to leasing.”

The full list:

1. Consult an attorney before you sign a lease and review each term and condition with the attorney
2. Ask all necessary questions to ensure that you understand all terms and conditions
3. Obtain in writing all promises and conditions and make sure those written promises are part of the lease
4. Negotiate as you may get better terms than those initially offered to you
5. Search for and negotiate with more than one gas operator
6. There is strength in numbers so consider negotiating your lease together with a group of neighbors or interested parties
7. Obtain copies of the lease you sign and a copy of the lease signed by both you and the gas operator to make sure that the lease reflects the agreement reached with the landman
8. The right to cancel is yours for three (3) business days after signing the lease, but to cancel, you must comply strictly with all requirements (consult your attorney)