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SB554 SUB1 Senate Bill 554 History

OTHER VERSIONS  -  Committee Substitute (2)  |  Enrolled Version - Final Version  |  Introduced Version  |     |  Email
Key: Green = existing Code. Red = new code to be enacted

WEST virginia legislature

2020 regular session

Committee Substitute

for

Senate Bill 554

Senators Smith, Clements, Pitsenbarger, Roberts, Trump, Romano, Hamilton, and Maroney, original sponsors

[Originating in the Committee on Energy, Industry, and Mining; reported on January 31, 2020]

 

 

A BILL to amend the Code of West Virginia, 1931, as amended, by adding thereto a new section, designated §36-4-9b, relating to the termination, expiration, or cancellation of oil or natural gas leases; providing a requirement for a lessee to execute and deliver to the lessor, within a specified time and without cost, a recordable release for terminated, expired, or cancelled oil or natural gas leases; providing for a procedure by which a lessor may serve notice to a lessee, if a lessee fails to timely provide the release; providing requirements for the content of the notice; requiring a lessee to timely notify the lessor in writing of a dispute regarding the termination, expiration, or cancellation of the oil and natural gas lease; providing for an affidavit of termination, expiration, or cancellation with specified contents; and providing a requirement that county clerks accept and record said affidavit.

Be it enacted by the Legislature of West Virginia:


ARTICLE 4. COVENANTS.


§36-4-9b. Release of Terminated, Expired or Canceled Oil or Natural Gas Leases.

(a) Not more than 30 days after the termination, expiration or cancellation of an oil or natural gas lease, the lessee, shall deliver to the lessor, without cost to the lessor, or his or her successors or assigns, a properly executed and notarized release of such lease in recordable form.

(b) If the lessee fails to provide a timely release as required by subsection (a) of this section, the lessor, or his or her successors or assigns, may serve notice on the lessee of lessee’s failure to provide such release. The notice shall contain the following:

(1) A statement that:

(A) The lease is terminated, expired, or canceled according to its terms, including the date of such termination, expiration, or cancelation;

(B) The lessee has a duty to provide a release pursuant to subsection (a) of this section; and

(C) If the release, or a written challenge to such termination, expiration or cancelation, is not received by lessor, or its successors or assigns, from the lessee within 30 days from receipt of this notice, the lessor, or his or her successors or assigns, shall have the right to file an affidavit of termination, expiration, or cancellation under subsection (e) of this section;

(2) The name and address of the lessor or his or her successors or assigns;

(3) A brief description of the land covered by the lease including, but without limitation, the state, county, tax district, tax map and parcel, watershed, historical farm name, or other identifying information;

(4)  If there is a well on the land covered by the lease, the name or API number of the well, if known to the lessor or his or her successors or assigns;

(5)  If located in a unit, the name of the unit, if known to the lessor or his or her successors or assigns; and

(6) The recording information for the lease, or a memorandum of lease, in the public records of the county or counties, along with the execution date of the lease, and the identity of the original lessor and lessee under the lease.

(c)  Service of notice under subsection (b) of this section shall be effected either personally or by certified mail to the lessee’s last known business address, or, if service cannot reasonably be made by those means, by publication once a week for two weeks in a newspaper of general circulation in the county or counties in which the lands covered by the lease are located.

(d)  If, after receiving a notice of termination, expiration, or cancellation under subsection (b) of this section, the lessee disputes in good faith that the oil or natural gas lease is terminated, expired, or canceled as stated in the notice, the lessee must, not more than 30 days after receipt of the notice, deliver a written challenge to the lessor, or his or her successors or assigns, detailing the good faith basis for such dispute.

(e) A lessor, or his or her successors or assigns, who has served a notice under subsection (b) of this section and fails to receive a timely challenge from the lessee under subsection (d) of this section may record an affidavit of termination, expiration, or cancellation of an oil or natural gas lease in the office of the county clerk in the county or counties where the lands covered by the lease are situated.  The county clerk of each county shall accept all such affidavits and shall enter and record them in the official records of that county and shall index each in the indices under the names, as they appear in the affidavit, of the original lessor, the original lessee, the lessor seeking the release and the lessee identified in the affidavit.

 (f)  An affidavit of termination, expiration or cancellation of an oil or natural gas lease shall be in the form of an affidavit and contain the following information:

(1) The name and address of the affiant,

(2) The names and addresses of the lessor and lessee,

(3)  If located in a unit, the name of the unit, if known to the affiant,

(4)  If there is a well on the land, the name or API number of the well, if known to the affiant,

(5) The recording information for the lease, or a memorandum of same, in the public record of the county or counties, along with the execution date of the lease, and the names of the original lessors and lessees under the lease,

(6) A brief recitation of the facts known to the affiant relating to the termination, expiration, or cancellation of the lease including relevant dates;

(7) A statement that the lessor, or its successors or assigns, complied with its duty to serve proper notice to the lessee under subsection (b) of this section and that the lessee failed to provide a timely challenge to the notice as provide in subsection (d) of this section; and

(8) The notarized signature of the affiant.

(g) The lessor, or its successors or assigns, is not required to use the provisions of this section to establish that a lease is terminated, expired, cancelled or otherwise no longer in effect.  A lessor’s, or its successors’ or assigns’, decision not to use the provisions of this section is not evidence that a lease is still in effect.

 

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