| ASSIGNMENT |
Permits a company to sell or transfer a lease to another firm. |
| EXTENSION |
The original lease term is typically for a period of 5 years. This clause grants the company the right to extend the initial term for an additional period, often five more years.
|
| FACILITIES CLAUSE |
Delineates setbacks from drilling activity to a dwelling, barn, water wells, roads, or other structures. |
| FORCE MAJEURE |
Ordinarily involves natural disasters and other circumstances beyond the control of a party to the lease. |
| INDEMNIFICATION |
If given by the company in its lease, the landowner is protected from certain types of liabilities connected with the company’s activities on the affected land. |
| INJECTION WELL |
A well whose purpose is to receive waste water and other products from oil and gas wells. |
| ON-SITE STORAGE |
Permits the company to utilize land for underground storage of natural gas, possibly from another property. |
| PITS |
Unless prohibited in the lease, a company may be allowed to deposit drilling waste into pits on the affected property. Companies now rarely use pits for the storage of waste water. |
| POST-PRODUCTION COSTS |
The company may deduct some of these costs of producing the natural gas before royalties are paid If the lease permits. |
| PUGH |
Protects a landowner from the company holding rights over an entire parcel, where only a portion of the parcel is being used for drilling. |
| WATER TESTING |
If called for in the lease, requires the company to independently test the landowner’s drinking water supply, and within a specified distance of the well, before, and sometimes after, drilling.
|
Prepared by Geauga County Planning Commission, January 2012
Note: The foregoing does not constitute or represent legal advice. Please consult with an experienced attorney before entering into a lease on your property.