Other Factors for Landowners To Consider

Without going into detail, the following factors may be considered by landowners when negotiating a lease.

1. If the land contains several producing formations at varying depths, lease each strata independently.
2. Always note in the lease whether the land can be used for underground storage of gas or oil.
3. Always insert provisions allowing free access to books, records, and drilling data accumulated pursuant to operations conducted on the landowner's premises.
4. If possible, negotiate some provisions whereby the landowner may assume control of the casing in the borehole when operations are abandoned. The casing can then be used to withdraw any remaining gas or extract fresh water for domestic or agricultural purposes.
5. Provide that if the lessee does not rectify any breach of a covenant contained in the lease within 30 days after lessor gives written notice, the lessee should pay reasonable attorney fees and reasonable investigative costs incurred by lessor in preparing lessor's case for trial.
6. Require lessee to indemnify, save and hold lessor harmless from all claims, demands and causes of action stemming from activities undertaken by lessee or lessee's assignees, their employees, agents, contractors and subcontractors, during operations conducted on the leased premises. As an alternative, require the lessee to post bond and carry comprehensive liability insurance of a specified amount as added security from such claims.