Energy Blog

Why Lease Assignments are Critical to Identifying Growth Opportunities

In a resilient, competitive market, you need the full land data picture to pinpoint joint ventures, find new opportunities and know your competition.

The last few years in the oil and gas industry have been full of uncertainty and belt-tightening, as sustained low prices led to strategies for reducing capex and opex including consolidations and large-scale, global reductions in workforce. There is good news, though. The outlook for the near future is mostly positive, as our experts expect to see the prices continue their recovery.

That prediction bodes well for landmen who are on the front line of the industry. Whether as a company man or an independent contractor, a landman must meet certain criteria to stay in the game.  Accuracy is essential. Speed is vital. Delivering value is critical.

As the industry recovers, the best in the business will be able to collect and analyze land lease data to make better, more informed decisions faster than their competition.

Assignments – The Missing Piece of the Lease Data Puzzle

Today’s landman needs to make it a top priority to know every bit of the latest information such as:

  • Who owns the leases and mineral rights?
  • Which land brokers are buying and selling in an area of interest?
  • What leases are coming up for assignments and/or bids?

Land and lease data are complicated, much like a big jigsaw puzzle with pieces scattered all over the place. Getting a fast, efficient, and most importantly, accurate picture of the leaseholders in an area of interest is challenging and just one mistake can be costly. 

Figure 1: Lease report shows the chain of assignments on leases.

Certainly, technology has transformed how to access land and lease information and the speed at which it can be acquired. Now, rather than making the first step a visit to the county courthouse, you can sift through information on state websites, the Bureau of Land Management website or even purchase access to databases compiled by third parties.

However, even with all this information at their fingertips, most of these resources are missing a critical piece of the lease data jigsaw puzzle – assignment data.

Leases trade hands frequently, and in today’s competitive market, most oil and gas leases are assigned.  Without assignment data, it is impossible to run a competitive analysis or know what the opportunities are in an area of interest. Missing an assignment can result in wasting time chasing down the wrong leaseholder.

But making more trips to the county courthouse and spending more hours searching through documents is not the answer to identifying assignments. Long lines, waiting for access to documents, and possible competitors watching every move slow down the process. Landmen who want to beat the competition know that clean, reliable data,  including  assignments, are necessary to accurately analyzing and establishing mineral ownership. Without assignment data, the analysis is simply not complete.

Take action- not time.

Even though assignment data is publicly available, collecting and compiling data from federal agencies, state land boards, and hundreds of county courthouses and providing users a quality checked and verified database takes the time-consuming legwork out of the assignment equation. A landman could go to the courthouse and spend days or weeks researching the same information that is instantly available in the database. With more than 700,000 assignment records in the database, getting names and addresses and tracking down leaseholders is exponentially easier.

Online tools make it easy for landmen to query which leases have been assigned, query based on a particular assignor or assignee, and determine the current leaseholder. They can create reports showing who is assigning to whom or create detailed reports showing the chain of assignments on leases. They also can easily identify companies with joint ventures by reviewing assigned leases to compare partial assignments and multiple leaseholders on the same lease. 

Figure 2: View summary fee lease layers such as the top leaseholder or top ten leaseholders on a section or tract level.

Want to learn how IHS Markit data can make the courthouse the last stop instead of the first—or even a non-stop? Check out the details of our land and lease data offering or request a demo. 

Stephen Trammel is Director, North America Well and Production at IHS Markit. 

Posted 16 February 2017

About The Author

Research Director and Advisor Unconventional

Stephen Trammel is an expert on US current oil and gas activity with a special focus on the increasingly important role unconventionals play in the world’s oil and gas supply picture. He is a regular speaker and writer on a variety of industry topics, having begun his oil and gas industry career as a scout and writer covering Rocky Mountain activity for Petroleum Information (now IHS)