2016 Illinois Compiled Statutes
Chapter 765 - PROPERTY
765 ILCS 520/ - Oil and Gas Rights Act.
(765 ILCS 520/0.01) (from Ch. 96 1/2, par. 4900)
Sec. 0.01. Short title. This Act may be cited as the Oil and Gas Rights Act.
(Source: P.A. 86-1324.)
(765 ILCS 520/1) (from Ch. 96 1/2, par. 4901)
Sec. 1. When the right to drill for and remove oil and gas from any lands in this State is owned by joint tenants, or tenants in common, whether such right or title is derived by purchase, legacy or descent, or whether any or all of the claimants are minors or adults, any one or more of the persons owning a 1/2 interest or more in the right to drill for and remove the oil and gas from such lands may be authorized to drill for and remove oil and gas from such lands in the manner hereinafter provided.
(Source: P.A. 83-388.)
(765 ILCS 520/2) (from Ch. 96 1/2, par. 4902)
The owners of such interest desiring to drill for and remove oil and gas may file a complaint in the circuit court of the county in which such lands, or some part thereof, are located, asking the court for permission to drill for and remove oil and gas therefrom for the use and benefit of all the owners of the right to drill for and remove oil and gas from such lands, and setting forth the relevant facts and the interests of all persons owning the right to drill for and remove oil and gas under such lands, so far as the same are known to the plaintiffs.
(Source: P.A. 77-984.)
(765 ILCS 520/3) (from Ch. 96 1/2, par. 4903)
Sec. 3. Minors and persons under legal disability may institute or defend actions by guardian or next friend. Every person, including spouses of owners, having any interest in the right to drill for and remove oil and gas from such lands, whether in possession or otherwise, and who is not a plaintiff, shall be made a defendant to such complaint. Any person claiming or appearing to claim an interest in the right to drill for and remove oil and gas from such land may be made a defendant. When there are or may be any persons interested in the right to drill for and remove oil and gas from such lands whose names are unknown, the complaint shall so state, and such persons may be made parties to such action by the name and description of Unknown Owners.
(Source: P.A. 83-706.)
(765 ILCS 520/4) (from Ch. 96 1/2, par. 4904)
Sec. 4. Defendants, whether known or unknown, shall be summoned or notified in the same manner as known or unknown defendants may be summoned or notified in other civil cases.
(Source: Laws 1939, p. 805.)
(765 ILCS 520/5) (from Ch. 96 1/2, par. 4905)
Sec. 5. During the pendency of any such suit, any person claiming to be interested in the right to drill for and remove oil and gas from such lands may appear and answer the complaint, and assert his or her rights, by way of interpleas; and the court shall determine the rights of all persons so appearing as though they had been made parties in the first instance.
(Source: Laws 1955, p. 1163.)
(765 ILCS 520/6) (from Ch. 96 1/2, par. 4906)
Sec. 6. In all suits under this Act, the court may investigate and determine all questions of conflicting or controverted titles, remove clouds from, and establish and confirm the title to the right to drill for and remove oil and gas from any of such lands.
(Source: Laws 1955, p. 1163.)
(765 ILCS 520/7) (from Ch. 96 1/2, par. 4907)
Sec. 7. If the court shall find that the material averments of the complaint are true, and that the plaintiffs do in fact own a one-half interest or more in the right to drill for and remove the oil and gas from such lands as joint tenants, tenants in common or coparceners, the court shall enter an order authorizing the plaintiffs to drill for and remove oil and gas from such lands so as to realize the full value thereof for the benefit of the parties entitled thereto. The court shall also provide by order for the disposition by the plaintiffs of the proportionate part of oil and gas of the defendants to the suit, and provide for the payment and distribution of the net proceeds thereof to the defendants, as their respective interests may appear, after deduction of the proportionate costs of such proceedings and of drilling for and producing, and disposing of, such oil and gas; and the court may, from time to time, require the plaintiffs to give bond or other security, to be approved by the court, to secure such payment to the defendants, or to prevent the attachment of any oil and gas or mechanics' liens to the interest of the defendants.
(Source: P.A. 79-1365; 79-1366.)
(765 ILCS 520/8) (from Ch. 96 1/2, par. 4908)
Sec. 8. In case a person or persons owning a one-half interest or more in the right to drill for and remove oil and gas from such lands has or have executed an oil and gas lease or leases to any person, firm or corporation, such lessee or lessees may institute and maintain or defend any suit provided for by this Act, either in the name of such lessee or lessees or in the name of his or its lessor or lessors.
(Source: Laws 1955, p. 1163.)
(765 ILCS 520/9) (from Ch. 96 1/2, par. 4909)
Sec. 9. The provisions of the Civil Practice Law, and all existing and future amendments to that Law, and the Supreme Court Rules now or hereafter adopted in relation to that Law, shall apply to all proceedings hereunder, except as otherwise provided in this Act.
(Source: P.A. 82-783.)
(765 ILCS 520/10) (from Ch. 96 1/2, par. 4910)
Sec. 10. (1) In this Section:
(a) "Payee" means any person or persons legally entitled to payment from the proceeds derived from the sale of oil or gas from an oil or gas well located in this State.
(b) "Payor" means the first purchaser of production of oil or gas from an oil or gas well, but the owner of the right to produce under an oil or gas lease or pooling order is deemed to be the payor if the owner of the right to produce and the first purchaser have entered into arrangements providing that the proceeds derived from the sale of oil or gas have been paid by the first purchaser to the owner who assumes the responsibility of paying those proceeds to the payee.
(2) (a) The proceeds derived from the sale of oil or gas production from an oil or gas well must be paid to each payee on or before 150 days after the end of the month of first purchase by a payor. After that time, payments must be made to each payee on a timely basis according to the frequency of payment specified in a lease or other written agreement between payee and payor. If the lease or other agreement does not specify the time for payment, subsequent proceeds must be paid no later than:
(1) 60 days after the end of the calendar month in
which subsequent oil production is sold; or
(2) 90 days after the end of the calendar month in
which subsequent gas production is sold.
(b) Payments may be remitted to payees annually for the aggregate of up to 12 months' accumulation of proceeds, if the total amount owed is $100 or less.
(3) (a) If payment has not been made for any reason in the time limits specified in subsection (2)(a) of this Act, the payor must pay interest to a payee beginning at the expiration of those time limits at the rate charged on loans to depository institutions by the New York Federal Reserve Bank, unless a different rate of interest is specified in a written agreement between payor and payee.
(b) Subsection (a) of this Section does not apply where payments are withheld or suspended by a payor beyond the time limits specified in subsection (2)(a) of this Act because there is:
(1) a dispute concerning title that would affect
distribution of payments;
(2) a reasonable doubt that the payee does not have
clear title to the interest in the proceeds of production; or
(3) a requirement in a title opinion that places in
issue the title, identity, or whereabouts of the payee and that has not been satisfied by the payee after a reasonable request for curative information has been made by the payor.
(4) (a) If a payee seeks relief for the failure of a payor to make timely payment of proceeds from the sale of oil or gas or an interest in oil or gas as required under Section (2) or (3) of this Act, the payee must give the payor written notice by mail of that failure as a prerequisite to beginning judicial action against the payor for nonpayment.
(b) The payor has 30 days after receipt of the required notice from the payee in which to pay the proceeds due, or to respond by stating in writing a reasonable cause for nonpayment.
(c) A payee has a cause of action for nonpayment of oil or gas proceeds or interest on those proceeds as required in Section (2) or (3) of this Act in any court of competent jurisdiction in the county in which the oil or gas well is located.
(Source: P.A. 99-129, eff. 1-1-16.)
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