In a contract, a free-gas clause permits the property owner to utilise the gas generated from their property without any cost. This provision is commonly employed in colder regions where gas is utilised for illumination and heating. Nevertheless, there are typically restrictions on the amount of gas that can be consumed and the purposes for which it can be used.
In an oil-and-gas lease, a free-gas clause permits the lessor or surface owner to utilise the gas extracted from the leased property without charge. This clause is commonly employed in colder states where gas is utilised for domestic heating and lighting. For instance, if a landowner leases their property to an oil and gas company, they may incorporate a free-gas clause in the lease agreement. This clause would enable the landowner to use the gas produced from the property for their personal use without incurring any extra expenses. However, free-gas clauses typically have restrictions on the amount of gas that can be used and its usage. For example, the clause may limit the gas usage to 300 MCF per year and restrict it to domestic heating and lighting only. In summary, free-gas clauses offer a benefit to the landowner by allowing them to utilise the gas produced from their property without any additional costs.
A free-gas clause is a provision in a lease agreement that grants the tenant the right to receive a certain amount of free gas or fuel for their use.
No, free-gas clauses are not very common in lease agreements. They are more commonly found in specific types of leases, such as those for commercial properties or properties located in remote areas.
Yes, a landlord has the right to include a free-gas clause in a lease agreement if they wish to do so. However, it is important for the clause to be clearly written and agreed upon by both parties.
The amount of free gas provided under a free-gas clause can vary depending on the specific terms of the lease agreement. It is typically stated as a specific quantity or a monetary value.
Generally, a landlord cannot unilaterally change the terms of a free-gas clause during the lease term. Any changes to the clause would require the mutual agreement of both the landlord and the tenant.
In most cases, a tenant cannot sell or transfer their free gas to someone else. The free gas is typically intended for the tenant’s personal use and cannot be used for commercial purposes or transferred to another party.
If the landlord fails to provide the agreed-upon amount of free gas, the tenant may have legal recourse. They can potentially seek compensation for the value of the gas that was not provided or terminate the lease agreement if the breach is significant.
A tenant can certainly request additional free gas, but it is up to the landlord’s discretion whether to grant such a request. It is advisable for tenants to negotiate and clarify the terms of the free-gas clause before signing the lease agreement.
Yes, a landlord can charge the tenant for any excess gas usage beyond the free gas provided. This would typically be outlined in the lease agreement or in a separate utility agreement.
In most cases, a tenant cannot opt out of a free-gas clause if it is included in the lease agreement. However, tenants can negotiate with the landlord to modify or remove the clause before signing the lease.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 17th April 2024.
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