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ARTICLE · 08 JANUARY 2021

Wait, What Am I Buying?

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This article focuses on transactions that cover only portions of an underlying oil and gas asset.

United StatesReal Estate and Construction
Akin Gump Strauss Hauer & Feld LLP
Akin Gump Strauss Hauer & Feld LLP
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This article focuses on transactions that cover only portions of an underlying oil and gas asset. Examples include transactions that convey (or reserve) a wellbore interest, transactions that are depth-limited and transactions that include only some (but not all) of the tracts covered by an underlying oil and gas lease or mineral interest. This article discusses certain issues raised by these kinds of transactions and provides some practical tips to avoid potential pitfalls.

WHAT TYPE OF INTEREST IS BEING CONVEYED/RESERVED?

Wellbore Interests

Wellbore conveyances / reservations are nothing new; however, wellbore reservations have become particularly common in acreage trade transactions. These transactions raise the issue of what type of interest is being assigned or reserved and what appurtenant rights are included. While questions and disputes involving the scope of wellbore conveyances have existed in Texas law for many years,1 we have observed a recent trend

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