It is legal to backdate on lease for petroleum?

Full question:

A 1 year oil and gas lease with Mission River Systems terminates on July 27, 2004. Mission Rivers assigns the lease to Dewbre Petroleum and was executed on November 16, 2004, 'however effective as of August 1, 2004'. Is this legal to backdate ? An over-riding Royalty was given on August 1, 2003, which was 4 days after the lease was signed on July 27, 2003 and said lease expired on July 27,2004..Does this over-riding interest expire with the termination of lease on July 27, 2004?Oil production did not start until October, 2004 and we received our first royalty check on Dec. 5, 2004. Can this 2.25% over-riding be taken away because it expired with the termination of the lease?

• Category: Oil Gas and Minerals
• Date: 04/07/2025
• State: Texas

Answer:

We cannot give legal advice. The following is not a substitute for the advice of a local attorney. But we hope the information will be useful.

The backdating is not necessarily improper, but does raise questions because it is not a true representation of the timing of the ownership interests of the two parties (Mission River and Dewbre). A party cannot back-date their way out of owing money.

Whether the over-riding interest expires with the lease on July 27, 04, depends on the technicalities of the contracts involved. If you were paid money, they probably cannot take it away from you just because they claim they were mistaken. They'd have to sue you and submit strong proof of a mistake in order to get a judgment for the money.

There are many details to your situation that can only be teased out by a careful examination of the contract and lease documents involved. If a substantial amount of money is a stake for you, you need to contact a local oil/gas attorney to review your situation with you. You should do so immediately, because you are describing events more than five years ago, and "statutes of limitations" prohibiting you from taking court action on old matters may be in play.