An important first step for landowners interested in oil and gas leasing is to determine who has legal ownership of the minerals beneath the land surface. Because Ohio law allows separate ownership of minerals and the land surface, a previous owner may have retained mineral rights before transferring the land surface ownership to another party. Someone who owns the mineral interest in a piece of property may also transfer that mineral interest to another. These types of transfers can create uncertainty about who has the right to develop the mineral resource. A comprehensive title search through the county recorder’s office will help a landowner understand the status of mineral ownership for a property parcel.
A landowner might find that a separate and undeveloped mineral interest has existed for a long period of time but it is unclear whether the mineral owner will ever develop the mineral resource. In this situation, Ohio law might allow the current surface landowner to reclaim the mineral rights. Ohio’s Dormant Minerals Act provides a detailed procedure for clarifying undeveloped mineral ownership.
Leasing Farmland for Oil and Gas Production
As the oil and gas industry continues to expand across an increasingly wide swath of Ohio, landowners are being approached by development companies with oil and gas lease offers. Landowners in this situation must carefully consider many issues prior to entering into an oil and gas lease. Questions to explore include:
Who owns the minerals beneath my land?
Who has leasing rights to the minerals?
How will I be reimbursed for my minerals?
How will my minerals be accessed?
How long will the extraction process last?
How will drilling activity affect my ability to farm?