Leasing Your Land

LEASING YOUR LAND

To Lease or Not To Lease...
The decision of whether or not to lease your land is a personal choice. There are both positive and negative aspects to leasing your land that must be considered.

Before considering signing a gas lease, the first question you should ask yourself is “why do I own my property?" Is your land used for farming, are you a sportsman, is it a wildlife refuge, or your private getaway? Allowing a gas company to drill a well on your property can impact all of these aspects and you have to ask yourself if you are willing to give up any or all of the uses listed above.

The positive benefits to leasing your land can include money received as part of the signing bonus (when you first sign the lease) and any royalties that result from a successful well that is drilled, if your property is included in the spacing unit.

Negative aspects can include truck traffic, noise, dust, clearing of land for access roads and well pad, and potential environmental issues in the event of a spill.

Please note, under NYS law, you do not have to sign a gas lease to collect royalties if your property is within the spacing unit and you are compulsory integrated. A spacing unit is the area that the drilled well will pull gas from - here is an example of a spacing unit from NYS DEC.

There are three things that all landowners must know about oil and gas leasing:

1. You DO NOT have to lease your land to an oil and gas company to receive royalties.

2. If you make the decision to lease your land – either as an individual or as part of a landowner coalition), be sure the lease gets reviewed by an attorney familiar with oil and gas leases.

3. If you plan to lease your land – DO YOUR HOMEWORK! Being part of a landowner coalition can help with the sharing of information, but every landowner who plans to lease their land needs to make every effort to get educated on the pros and cons of gas leasing so you can make wise decisions.

Some places to get information include:

• Websites like this one – which will be regularly updated with new information on gas leasing and natural gas exploration

• Landowner coalition websites – many of the coalition websites have numerous links to information

• Many landowner coalitions and other organizations host educational workshops and events. You should try to attend as many of these events as possible. The question and answer sessions are invaluable.

• Stay informed with local news articles and websites

• Cornell Cooperative Extension and Penn State Cooperative Extension both have excellent websites on gas leasing and natural gas exploration

• Keep an eye on the NYS DEC Mineral Resources Environmental Notice Bulletin - these can provide you with information about where drilling activity is taking place