What is a Landman in the Oil and Gas Industry

Landmen are members of oil and gas company, mineral, or other energy resource exploration and production team who negotiate and interact with landowners for the acquisition of mineral or other energy lease agreements. It is not uncommon for a landman to specialize in several aspects of the profession at the same time due to the diversity of the services he provides to the petroleum industry and other industries. It is also possible to use the term land manager interchangeably.

Asides from being used by exploration companies, Linear projects, such as pipelines, telecommunications, transportation and power lines, are known as right-of-way projects and would be staffed by ROW agents. While landmen and right-of-way agents are often referred to interchangeably, their duties significantly vary. ROW agents handle projects that involve linear corridors that can span interstates and usually involve easement conveyances, whereas landmen generally deal with site-specific projects (drill sites) and leases.

What is a Landman?

Oil and gas exploration companies employ petroleum Landmen to perform various services. These seinrvices are listed on the website of the American Association of Professional Landmen (AAPL) as follows:

• Mineral rights acquisition or divestiture negotiations
• Exploring and/or developing minerals through business agreements
• Researching public and private records to determine mineral ownership
• Title review, rectification, and other means of reducing title risk associated with ownership in minerals; management of rights and obligations are gotten from interests in minerals ownership and pooling or unitizing interests in minerals.

Origin and History of the Landman Profession in oil and gas industry

In 1958, the University of Oklahoma established the first formal curriculum for petroleum land management. Landmen, however, have been used widely in the US petroleum industry for much longer. In Titusville, Pennsylvania, oil was discovered for the first time in 1859, which saw the beginning of the process of acquiring mineral rights in the United States.

Many oil and gas companies pump hydrocarbons under lease rights even though they own the rights to the mineral extracts. Oil companies usually rely on their landman to negotiate this lease contract and perform legal research to determine who is entitled to which minerals, prepare the necessary documents for acquiring the lease, arrange payment, and handle post-production and drilling-related issues with the landowner and/or mineral owner.

What does a landman do?

As a landman, your job begins by initiating contact with the land manager of the oil company you want to work with. Often the land manager is also the company’s general counsel and a full-time employee of the company. The land manager shows the landman where the company would like to lease, usually using a topographic or geological map.

Different things that a landman does

• Following the determination of the threshold acres, the landman must move to research the deed records related to the project immediately. They may have to go as far as the historical records of the property to determine the mineral owner. In many states in the US, the owner of the mineral state is different from the owner of the surface rights, so the landowner has to consider this while making their mineral rights title search.
• If the landman can locate the deed of the land ownership, they will have to identify the individual owners of the rights and their shares of ownership, then compile these findings into a report and eventually into a lease for each owner to sign.
• As soon as possible, the landman will begin the process of locating the appropriate mineral owners i.e., tracking down their current addresses and telephone numbers and for lease negotiations. There are many locations in which mineral rights can be obtained for as low as $15 per acre, like some parts of northwest Kansas, or as high as over $5,000 per acre, like some parts of central Oklahoma.
• Landmen can negotiate oil and gas leases over the phone, via email, or through the mail, depending on how quickly the project progresses and the experience of their landmen, but most astute landmen still prefer to speak with their mineral owners in person. Along with the upfront payment, the lease usually includes a royalty provision, usually ranging from 20 to 25 per cent of the after-cost profits from the well associated with the mineral owner’s share.

What are the different types of Landman?

In-house landman, independent field landman, and independent land consultants are the different types of landman jobs. A bachelor’s degree or master’s in business administration, or a law degree would be enough for the higher levels of landman jobs. It is often necessary to have some prior experience, even for entry-level field landman positions, unless you already have formal training.

1. In-House Landman

The in-house landman works for an oil and gas exploration firm or a large oil company. The In-house landman supervises a field team of landmen and coordinates their activities. The duties of an In-House Landman include;

• Trade and negotiate deals with other individuals and companies
• Draft and manage compliance with contracts
• Acquire leases, clear titles, and prepare land for drilling and other energy operations
• Ensure compliance with government regulation

2. Independent Field Landman

Field landmen are usually under the supervision of a land negotiator or senior landman. Among all the landman jobs, this one requires the least formal education. The duties of an Independent Field Landman include;

• Researching courthouse records, preparing reports, and pinpointing minerals and landowners is usually how they communicate with the public on behalf of the industry.
• Before drilling or operations for other energy sources, they negotiate leases and other agreements, obtain necessary curative documents, and conduct surface inspections.

3. Independent Land Consultants

Land Consultants are known as landmen and serve the client on a contract basis. People-management skills are essential for this type of landman job. The duties of an independent land consultant include;

• They perform all of the above functions as well as due diligence examinations required to sell and purchase companies and properties.
• The Bureau of Land Management and the Forest Service are two examples of government agencies land consultants work with.
• The land consultant would be advising on how to acquire oil and gas leases while also pointing exploration and production companies in the direction of land filled with minerals.

Who needs the services of a landman?

The people who need the services of a landman include the oil and gas exploration and production company. This job involves negotiating the right to drill or operate on the land of individuals, businesses, and the government on behalf of these companies.

Researching land ownership and negotiating with landowners to buy or lease the land for drilling or pumping is part of the job of these energy professionals. Though a petroleum landman works primarily for oil companies, demand for their services is growing in the wind energy sector as firms are demanding their services currently.

How do you become a landman and do you need a degree?

At a minimum, to become a landman, you need to get an associate’s degree in land management or paralegal certification, although many firms would want applicants with a degree in land management or any related field, like geography, geology, commerce, economics, or petroleum engineering.

Students interested in the energy industry can also enroll in short-term land management certification programs offered by several universities. Law degrees can greatly increase earning opportunities for landmen.

How long does it take to become a landman?

The maximum time one can spend on acquiring a land management course or technical degree that will qualify you for a job is two years. Professional land management and petroleum land management programs are offered by some schools. Some of the schools that offer energy and petroleum land management degree include Texas Tech University, The University of Tulsa, and Oklahoma City University.

Consider a complementary field of study if your school does not offer landman training. You can increase your job prospects by studying real estate, business, science, surveying, engineering, mathematics and energy management. Invest time in areas of study that help you gain analytical skills, property ownership knowledge, and energy sector knowledge.

How much does a landman make a year?

As of 2021, the average salary of an oil and gas landman in the United States is $80,000.

Conclusion

There is fierce competition for Landmen and they are in high demand. Identify and earn lucrative business opportunities in the oil and gas industry by developing both hard and soft skills. Petroleum land management provides the skills necessary to secure meaningful employment, but each job has its requirements.

Working as a landman is challenging, interesting, and rewarding regardless of whether you work for one company or as an independent contractor.

ATTRIBUTES:

Photo by mohamed_hassan from PxHere

Related Articles

Oil and Gas Glossary – 300+ Mineral Rights Terms What are Mineral Rights and How Do They Work: Different Types of Ownerships and Trading Petroleum Industry