Mineral Rights Disputes are Common Place in Shale Plays

by Kenneth E. DuBose on October 31, 2011

Mineral rights disputes get more serious when a boom hits. No one cares too much about what they own below the surface until it has value. Eagle Ford Shale sized value. That’s when the lawyers come out. In places like Texas, an operator might be working with landowners and mineral owners who have severed rights dating back 100 years. Over a period of 100 years, there is a lot of opportunity for misunderstood or bad transactions. In the case laid out below, it seems as if the landowners will triumph, but if the bank can prove its ownership you can bet they’ll be happy to have royalties in Karnes County.

If for no other reason than to save your heirs the trouble, make sure you get proper legal advice in all land transactions.

“My great-grandmother did not sign her name,” Frank Moravits said. “Somebody from McMullen signed her name to the paperwork.”

In 1943, a judge declared the signatures invalid and returned the mineral rights to Mary and her family.

Her descendants gave the rights little thought until the recent boom in the Eagle Ford shale, which became one of the hottest drilling prospects in the nation, with leases in some areas soaring to as much as $10,000 an acre.

Frank Moravits leased the mineral rights to a group of investors who entered into a drilling deal with Houston-based Petrohawk Energy. Before Petrohawk could begin drilling, though, another company showed up, also claiming to hold the mineral rights.

Read the entire news release at mysanantonio.com

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