Negotiating directly with the company
When negotiating with oil and gas companies regarding the terms of the lease agreement, landowners are advised to research a fair and reasonable value to place on their land. You should consider both short term and long term impacts of the activity. You should also be prepared with plenty of evidence and accurate assessments to put yourself in the best position to negotiate a fair agreement with the company. Keep in mind, negotiating at this stage allows for more creative options in receiving compensation and may not be limited to a dollar value per acre.
A Guide to Negotiating Lease Agreements is now available on our site.
Renegotiating Rent Agreement
The amount of annual rent for a surface lease agreement may be renegotiated every four years. Either the landowner or the oil and gas company can initiate the discussion by completing Surface Rights Board (SRB) Form 2 – Notice to Lessee/Lessor for Rent Renegotiation. The SRB Rent Review information sheet provides additional explanation.
The SRB is required to assess the values based on the same considerations as a right of entry, as outlined in section 154 of the Petroleum and Natural Gas Act, with additional consideration given to the rate of inflation.
Terms of agreement through Right of Entry
If a company is not able to negotiate an agreement with the landowner, they have the option to apply to the SRB for the right to enter the land. Landowners should understand, decisions made by the SRB are restricted to the considerations outlined in section 154 of the Petroleum and Natural Gas Act.