Not all transactions affecting mineral properties in present or
potential oil and gas producing areas involve the sale of securities.
Often, even those transactions which are regarded as sales of
securities come under one or more of the available exemptions,
expressed or implied, in the various Securities Laws of the United
States. The purpose of this article will be to categorize, as clearly
as possible, those oil and gas transactions which are: (1) not
regarded as securities transactions, (2) probably not securities
transactions but within the "areas of danger", (3) clearly securities
transactions. Once the attempt to categorize has been completed,
the available exemptions will be examined.
In closing, the penalty for intentional or, more often, innocent
mistake will be reviewed briefly. For those who are expert, or
even initiated, in the securities area, the penalties for failure to
comply with the securities acts are ever present in your mind, but
for the oil man who is unfamiliar or poorly advised in this area,
the revelations of this paper should be sufficient stimuli to encourage
him to secure competent advice.
The scope of this paper will be limited primarily to the Texas