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All freehold owners should keep copies of their title to their mineral rights together with any other agreement which is binding on their rights in a safe and accessible place.  

Particularly in situations where a number of siblings have inherited mineral rights from a deceased parent who had leased the mineral rights under a lease agreement which remains binding on the parent’s heirs, all of the current freehold mineral rights owners may not have a copy of the lease.  If you are in this situation, get a copy from one of your siblings or search your title (see “Frequently Asked Questions” – “How do I determine what minerals I own”) and write a letter requesting a copy of the lease to the land department of the company that has the most recent caveat or change of address for service protecting a lease registered against your title.  If you can’t find an address for the company’s Canadian head office by googling, you may have to order a copy of the caveat or change of address for service and write to the company’s address for service.  Most energy company-lessees will comply with such a request within several weeks.

The framework for the relationship between and energy company-lessee and a freehold owner-lessor under a freehold lease agreement may be modified by a gross royalty trust agreement or GRT (see “Gross Royalty Trust Agreements”), a pooling agreement (see “Pooling Agreements”) or a unit agreement (see “Unit Agreements”).  Your mineral rights may not be burdened with any of these agreements or by some or all of them.

If your mineral rights are burdened with either a GRT or a unit agreement there will be a caveat filed by the trustee of the GRT or the operator of the unit against your title.  If you don’t have a copy of any such GRT you should request one from the trustee referenced in the caveat.  You should also request a copy of list of unitholders in the GRT.  The trustee will charge you a modest fee for each document (typically $10.00).  If you don’t have a copy of any unit agreement referenced in a caveat registered against your title, you should request a copy from your energy company-lessee.  Most energy company-lessees will comply with this type of request but, if you are unable to obtain a copy of the unit agreement from your lessee, you can obtain a copy from the regulatory authority in the province in which your mineral rights are located.

Pooling agreements are typically not protected by caveats registered against your title.   Pooling or combining mineral tracts is typically done in situations where the spacing unit for production of oil or gas is comprised of more than one tract of freehold minerals.  As the spacing unit for gas production is a section and as most freeholders have an interest in a quarter or perhaps a half section of mineral rights, the production of natural gas from freehold mineral rights typically involves a pooling agreement.  

Most modern freehold leases, including all forms of CAPL leases, provide the energy company-lessee with the right to pool or combine your mineral rights with any other mineral rights on an acreage basis provided that the total area of the pooled lands does not exceed the area of a spacing unit.  CAPL leases also obligate the energy company-lessee to provide the freehold owner-lessor with written notice describing the extent of any such pooling and the spacing unit.  Many energy companies do not comply with the requirement to provide notice.

Freehold Petroleum & Natural Gas Owners Association

"Freehold Owners Association"

901, 1000 5th Ave SW, Calgary, AB, T4P 4V1 Telephone: 403-245-4438