Under Pennsylvania law, an interest in land is divided into both a surface (real) estate and a mineral estate. These estates may be held separately and minerals on the same tract of land may even be separated from each other – coal, gas, oil, etc. Regardless, all holders of these interests have rights under the law. The law recognizes the mineral holder’s right to recover the mineral, while the landowner has the right to protect his interests from unreasonable encroachment or damages.
The bottom line is that, even though you may hold title free and clear to your property, someone else may own the mineral rights on the tract. A thorough searching your property’s historical deeds back to the nineteenth century might reveal that oil and gas have been separated from the surface estate. A phrase in an old deed such as “oil and gas excepted and reserved” means that the surface was sold separately from the oil and gas property at that transfer. If you find such a statement in an old deed, the oil and gas rights were probably separated from your estate long ago.
A mineral lease is a contract between the owner of a mineral tract (the lessor), who may or may not be the owner of the surface rights, who grants the right to develop deposits of the mineral to a producer (the lessee). Oil and gas can be sold or leased separately to different parties and different deposits of the same minerals can also be leased or sold separately. Usually, a lessee will want the right to sell or reassign a mineral lease to another party. A lease is typically secured by annual rental payments or a royalty on production paid to the lessor.
If you are considering leasing oil, gas or mineral rights to a producer, immediately contact AAAL – Allegheny Attorneys at Law, P.C. at (412) 426-3321 for a consultation on how to protect your interests now and in the future.