Tell Us What You Want; What You Really, Really Want:
JOAs and Saltwater Disposal Lease

It has been said that the first secret to getting what you want is knowing what you want.  The process of drilling an oil or gas well and subsequently obtaining production from the same is complex and fraught with many hurdles.  A party participating in drilling and production operations must enter into numerous agreements to get what it wants.  Such agreements will be necessary at all stages of the operations, will be negotiated with various parties ranging from landowners to other drilling entities, and must be drafted with an understanding that they will be in effect for many years, over which time the oil and gas industry and regulations governing it, are sure to change.  Well-drafted agreements governing each step of drilling and production operations are crucial in obtaining and securing rights most favorable to your operations and planned goals. 

JOAs

The Joint Operating Agreement (“JOA”) governs operations in an area of land where numerous parties share drilling rights and secures various rights of the joining parties. Standard form JOAs exist and are freely available for parties to use. However, due to the complexity of drilling operations and the fact that a JOA can be in effect for an extended period, the terms of a standard form JOA are unlikely to cover every situation that can arise while developing the land.  Further, differing interpretations of the JOA tend to arise years after it is drafted, and the parties to the JOA change as assignments of the underlying interests occur. Case law relevant to JOAs is so substantial and extensive that it deserves its own class in law schools, and parties to a JOA often require quick negotiations of the JOA terms due to their drilling schedules and planned operations. 

Saltwater Disposal Lease

The Saltwater Disposal Lease is another type of agreement related to the drilling and production process.  A party wishing to inject toxic saltwater or brine (the byproduct of fracking operations) into the ground using a saltwater disposal well must enter into a lease with the owner of the surface of the tract where the saltwater disposal well is to be placed. Like any other agreement, these Saltwater Disposal Leases can be drafted to favor the operator or the landowner. For instance, operators must be sure to protect themselves from the rapidly evolving environment caused by more and more regulations being passed that limit or restrict saltwater disposal operations, all while having an eye on turning a profit. 

 

At RR&A, we possess the required experience and knowledge to help you best negotiate JOAs and Saltwater Disposal Leases. We will assist you in both going beyond standard form provisions by negotiating terms favorably tailored to your operations and capabilities as they may evolve during the life of the agreement and exercising your rights under an existing agreement. Contact RR&A and let us help you get what you want.

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Disclaimer: The information and material on this website is general information about our practice and firm. This information does not offer specific legal advice and the use of this information does not create an attorney-client relationship with RR&A or any of its attorneys. The information on this website should not be used for legal advice, and persons should not act upon the information on this website without engaging professional legal counsel.

Matt Dishong

Matt Dishong

Matt is a Senior Associate at R. Reese & Associates and part of the Land and Title team. Matt has experience assisting clients by preparing drilling and division order title opinions, drafting curative documents, and performing due diligence for complex, large-acreage transactions. To learn more about Matt, visit his attorney page.

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