Post Production Costs; Magic Language - GoHaynesvilleShale.com2024-03-29T13:37:32Zhttps://gohaynesvilleshale.com/forum/topics/post-production-costs-magic-language?commentId=2117179%3AComment%3A3637058&xg_source=activity&feed=yes&xn_auth=noYou're welcome.tag:gohaynesvilleshale.com,2017-08-11:2117179:Comment:36373292017-08-11T22:27:27.179ZSkip Peel - Mineral Consultanthttps://gohaynesvilleshale.com/profile/ilandman
<p>You're welcome.</p>
<p>You're welcome.</p> Thanks Skip!tag:gohaynesvilleshale.com,2017-08-11:2117179:Comment:36370582017-08-11T22:06:02.315ZLNhttps://gohaynesvilleshale.com/profile/LN
<p>Thanks Skip!</p>
<p>Thanks Skip!</p> Yes. Chesapeake changed the…tag:gohaynesvilleshale.com,2017-08-11:2117179:Comment:36373262017-08-11T21:52:30.400ZSkip Peel - Mineral Consultanthttps://gohaynesvilleshale.com/profile/ilandman
<p>Yes. Chesapeake changed the name in 2014.</p>
<table border="0" cellspacing="0" id="ctl00_cphContent_tblResults" width="100%">
<tbody><tr><td><span class="UserInput" id="ctl00_cphContent_lblName">CHESAPEAKE ENERGY MARKETING, L.L.C.</span></td>
<td><span class="UserInput" id="ctl00_cphContent_lblType">Limited Liability Company (Non-Louisiana)</span></td>
<td><span class="UserInput" id="ctl00_cphContent_lblCity">OKLAHOMA CITY…</span></td>
<td></td>
</tr>
</tbody>
</table>
<p>Yes. Chesapeake changed the name in 2014.</p>
<table id="ctl00_cphContent_tblResults" width="100%" cellspacing="0" border="0">
<tbody><tr><td><span id="ctl00_cphContent_lblName" class="UserInput">CHESAPEAKE ENERGY MARKETING, L.L.C.</span></td>
<td><span id="ctl00_cphContent_lblType" class="UserInput">Limited Liability Company (Non-Louisiana)</span></td>
<td><span id="ctl00_cphContent_lblCity" class="UserInput">OKLAHOMA CITY</span></td>
<td><span id="ctl00_cphContent_lblStatus" class="UserInput">Active</span></td>
</tr>
</tbody>
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<p></p>
<div id="ctl00_cphContent_pnlPreviousNames"><table width="100%" cellspacing="0" border="0">
<tbody><tr><td class="contentSubTitle">Previous Names</td>
</tr>
<tr><td><table cellspacing="0" border="0">
<tbody><tr><td> </td>
<td><span id="ctl00_cphContent_rptPreviousNames_ctl00_lblPreviousName" class="UserInput">CHESAPEAKE ENERGY MARKETING, INC. (Changed: 11/20/2014)</span></td>
<td> </td>
</tr>
</tbody>
</table>
</td>
</tr>
</tbody>
</table>
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<div id="ctl00_cphContent_pnlEntityInfo"><table id="ctl00_cphContent_tblHeader" width="100%" cellspacing="0" border="0">
<tbody><tr><td class="contentSubTitle" width="150">Business:</td>
<td><span id="ctl00_cphContent_lblBusinessName" class="UserInput">CHESAPEAKE ENERGY MARKETING, L.L.C.</span></td>
</tr>
<tr><td class="contentSubTitle">Charter Number:</td>
<td><span id="ctl00_cphContent_lblCharterNumber" class="UserInput">34543767Q</span></td>
</tr>
<tr><td class="contentSubTitle">Registration Date:</td>
<td><span id="ctl00_cphContent_lblRegistrationDate" class="UserInput">11/21/1996</span></td>
</tr>
</tbody>
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<table id="ctl00_cphContent_tblDomicile" width="100%" cellspacing="0" border="0">
<tbody><tr><td colspan="2" class="ResultsHeader">Domicile Address</td>
</tr>
<tr><td width="10%"> </td>
<td><span id="ctl00_cphContent_lblAddress1" class="UserInput">6100 NORTH WESTERN AVE.</span></td>
</tr>
<tr id="ctl00_cphContent_trCSZ"><td> </td>
<td><span id="ctl00_cphContent_lblCSZ" class="UserInput">OKLAHOMA CITY, OK 73118</span></td>
</tr>
</tbody>
</table>
<table id="ctl00_cphContent_tblMailing" width="100%" cellspacing="0" border="0">
<tbody><tr><td colspan="2" class="ResultsHeader">Mailing Address</td>
</tr>
<tr><td width="10%"> </td>
<td><span id="ctl00_cphContent_lblMailingAddress1" class="UserInput">6100 NORTH WESTERN AVENUE</span></td>
</tr>
<tr id="ctl00_cphContent_trMailingCSZ"><td> </td>
<td><span id="ctl00_cphContent_lblMailingCSZ" class="UserInput">OKLAHOMA CITY, OK 73118</span></td>
</tr>
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<div id="ctl00_cphContent_pnlCorporationAddresses"><table width="100%" cellspacing="0" border="0">
<tbody><tr><td colspan="2" class="ResultsHeader">Principal Business Office</td>
</tr>
<tr><td width="10%"> </td>
<td><span id="ctl00_cphContent_lblPrincipalOfficeAddress1">6100 NORTH WESTERN AVENUE</span></td>
</tr>
<tr id="ctl00_cphContent_trPrincipalOfficeCSZ"><td> </td>
<td><span id="ctl00_cphContent_lblPrincipalOfficeCSZ" class="UserInput">OKLAHOMA CITY, OK 73118</span></td>
</tr>
<tr><td colspan="2" class="ResultsHeader">Registered Office in Louisiana</td>
</tr>
<tr><td width="10%"> </td>
<td><span id="ctl00_cphContent_lblRegisteredAddress1" class="UserInput">3867 PLAZA TOWER DR.</span></td>
</tr>
<tr id="ctl00_cphContent_trRegisteredCSZ"><td> </td>
<td><span id="ctl00_cphContent_lblRegisteredCSZ" class="UserInput">BATON ROUGE, LA 70816</span></td>
</tr>
<tr><td colspan="2" class="ResultsHeader">Principal Business Establishment in Louisiana</td>
</tr>
<tr><td width="10%"> </td>
<td><span id="ctl00_cphContent_lblPrincipalLAAddress1" class="UserInput">405 HWY. 167 SOUTH</span></td>
</tr>
<tr id="ctl00_cphContent_trPrincipalLACSZ"><td> </td>
<td><span id="ctl00_cphContent_lblPrincipalLACSZ" class="UserInput">CHENEYVILLE, LA 71325</span></td>
</tr>
</tbody>
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<div id="ctl00_cphContent_pnlResultsHeader"><table id="ctl00_cphContent_tblStatus" width="100%" cellspacing="0" border="0">
<tbody><tr><td colspan="2" class="ResultsHeader">Status</td>
</tr>
<tr><td class="contentSubTitle" width="150">Status:</td>
<td><b><span id="ctl00_cphContent_lblStatus2" class="UserInput">Active</span></b></td>
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<tr id="ctl00_cphContent_trGoodStanding"><td class="contentSubTitle">Annual Report Status:</td>
<td><b><span id="ctl00_cphContent_lblInGoodStanding" class="UserInput">In Good Standing</span></b></td>
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<tr><td class="contentSubTitle"><span id="ctl00_cphContent_lblStatusDateLabel" class="contentSubTitle">Qualified:</span></td>
<td><span id="ctl00_cphContent_lblStatusDate" class="UserInput">11/21/1996</span></td>
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<tr><td class="contentSubTitle">Last Report Filed:</td>
<td><span id="ctl00_cphContent_lblLastReportFiled" class="UserInput">10/24/2016</span></td>
</tr>
<tr><td class="contentSubTitle">Type:</td>
<td><span id="ctl00_cphContent_lblStatusType" class="UserInput">Limited Liability Company (Non-Louisiana)</span></td>
</tr>
</tbody>
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<div id="ctl00_cphContent_pnlAgents"><table width="100%" cellspacing="0" border="0">
<tbody><tr id="ctl00_cphContent_trRegisteredAgent"><td class="ResultsHeader">Registered Agent(s)</td>
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<table width="100%" cellspacing="0" border="0">
<tbody><tr><td><table width="100%" cellspacing="0" border="0">
<tbody><tr class="RowNormal"><td><table class="TableBorder" width="100%" cellspacing="0" border="0">
<tbody><tr><td class="contentSubTitle" width="110">Agent:</td>
<td><span id="ctl00_cphContent_rptAgents_ctl00_lblAgentName" class="UserInput">C T CORPORATION SYSTEM</span></td>
</tr>
<tr><td class="contentSubTitle">Address 1:</td>
<td><span id="ctl00_cphContent_rptAgents_ctl00_lblAgentAddress1" class="UserInput">3867 PLAZA TOWER DR.</span></td>
</tr>
<tr><td class="contentSubTitle">City, State, Zip:</td>
<td><span id="ctl00_cphContent_rptAgents_ctl00_lblAgentCSZ" class="UserInput">BATON ROUGE, LA 70816</span></td>
</tr>
<tr><td class="contentSubTitle">Appointment Date:</td>
<td><span id="ctl00_cphContent_rptAgents_ctl00_lblAgentAppointmentDate" class="UserInput">8/15/2005</span></td>
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</tbody>
</table>
</td>
</tr>
</tbody>
</table>
</td>
</tr>
</tbody>
</table>
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<p></p>
<div id="ctl00_cphContent_pnlOfficers"><table width="100%" cellspacing="0" border="0">
<tbody><tr><td class="ResultsHeader">Officer(s)</td>
<td class="ResultsHeader" align="right"><font size="-2">Additional Officers: <span id="ctl00_cphContent_lblAdditionalOfficers">No</span> </font></td>
</tr>
</tbody>
</table>
<table width="100%" cellspacing="0" border="0">
<tbody><tr><td><table id="ctl00_cphContent_rptOfficers_ctl00_tblOfficers" width="100%" cellspacing="0" border="0">
<tbody><tr id="ctl00_cphContent_rptOfficers_ctl00_trOuter" class="RowNormal"><td><table id="tblInside" class="TableBorder" width="100%" cellspacing="0" border="0">
<tbody><tr><td class="contentSubTitle" width="110">Officer:</td>
<td><span id="ctl00_cphContent_rptOfficers_ctl00_lblOfficerName" class="UserInput">CHESAPEAKE ENERGY CORPORATION</span></td>
</tr>
<tr><td class="contentSubTitle">Title:</td>
<td><span id="ctl00_cphContent_rptOfficers_ctl00_lblOfficerTitle" class="UserInput">Manager</span></td>
</tr>
<tr><td class="contentSubTitle">Address 1:</td>
<td><span id="ctl00_cphContent_rptOfficers_ctl00_lblOfficerAddress1" class="UserInput">6100 NORTH WESTERN AVENUE</span></td>
</tr>
<tr><td class="contentSubTitle">City, State, Zip:</td>
<td><span id="ctl00_cphContent_rptOfficers_ctl00_lblOfficerCSZ" class="UserInput">OKLAHOMA CITY, OK 73118</span></td>
</tr>
<tr id="ctl00_cphContent_rptOfficers_ctl00_trOfficerCountry"><td class="contentSubTitle"><span id="ctl00_cphContent_rptOfficers_ctl00_lblCountry"></span></td>
<td><span id="ctl00_cphContent_rptOfficers_ctl00_lblOfficerCountry" class="UserInput"></span></td>
</tr>
</tbody>
</table>
</td>
</tr>
</tbody>
</table>
</td>
</tr>
</tbody>
</table>
</div>
<p></p>
<div id="ctl00_cphContent_pnlMergers"><table width="100%" cellspacing="0" border="0">
<tbody><tr><td class="ResultsHeader">Mergers <span id="ctl00_cphContent_lblMergerCount">(1)</span></td>
</tr>
</tbody>
</table>
<div id="ctl00_cphContent_udpMergers"><table cellspacing="0" border="0">
<tbody><tr><td><table rules="all" id="ctl00_cphContent_grdMergers" style="border-collapse: collapse;" cellspacing="0" border="1">
<tbody><tr class="RowHeader"><td>Filed Date</td>
<td>Effective Date:</td>
<td>Type</td>
<td>Charter#</td>
<td>Charter Name</td>
<td>Role</td>
</tr>
<tr class="RowNormal" style="font-weight: bold;"><td><span id="ctl00_cphContent_grdMergers_ctl02_lblFiledDate" class="UserInputNormal">10/12/2007</span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl02_lblEffectiveDate" class="UserInputNormal">10/12/2007</span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl02_lblType" class="UserInputNormal">MERGE</span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl02_lblCharterNumber" class="UserInputNormal">34543767Q</span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl02_lblCharterName" class="UserInputNormal">CHESAPEAKE ENERGY MARKETING, L.L.C.</span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl02_lblRole" class="UserInputNormal">SURVIVOR</span></td>
</tr>
<tr class="RowAlt"><td><span id="ctl00_cphContent_grdMergers_ctl03_lblFiledDate" class="UserInputNormal"></span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl03_lblEffectiveDate" class="UserInputNormal"></span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl03_lblType" class="UserInputNormal"></span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl03_lblCharterNumber" class="UserInputNormal">36283767Q</span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl03_lblCharterName" class="UserInputNormal">BROADSTAR GAS GATHERING, LLC</span></td>
<td><span id="ctl00_cphContent_grdMergers_ctl03_lblRole" class="UserInputNormal">NON-SURVIVOR</span></td>
</tr>
</tbody>
</table>
</td>
</tr>
</tbody>
</table>
</div>
</div> Here's a quick question: Is…tag:gohaynesvilleshale.com,2017-08-11:2117179:Comment:36372152017-08-11T21:46:22.328ZLNhttps://gohaynesvilleshale.com/profile/LN
<p>Here's a quick question: Is CEMI and CEMLLC the same Company?</p>
<p></p>
<p>I'm trying to get a better understanding of this process.</p>
<p></p>
<p>TIA.</p>
<p>Here's a quick question: Is CEMI and CEMLLC the same Company?</p>
<p></p>
<p>I'm trying to get a better understanding of this process.</p>
<p></p>
<p>TIA.</p> Wayne,
Thanks for commenting…tag:gohaynesvilleshale.com,2017-07-26:2117179:Comment:36355152017-07-26T12:48:08.178Zshelbyhttps://gohaynesvilleshale.com/profile/shelby
<p></p>
<p>Wayne,</p>
<p>Thanks for commenting on the Haynesville Shale site; my wife's family has some mineral interests in Wetzel Cty, WV. It amazes me the differences in how in the Northern plays, CHK claims gas is a "marketable product" at the wellhead, and in almost all the other states in the union, gas "is not" considered in a "marketable form" at the wellhead.</p>
<p>Sounds like this is one for the Supreme Court to rule on.</p>
<p>Shelby</p>
<p></p>
<p>Wayne,</p>
<p>Thanks for commenting on the Haynesville Shale site; my wife's family has some mineral interests in Wetzel Cty, WV. It amazes me the differences in how in the Northern plays, CHK claims gas is a "marketable product" at the wellhead, and in almost all the other states in the union, gas "is not" considered in a "marketable form" at the wellhead.</p>
<p>Sounds like this is one for the Supreme Court to rule on.</p>
<p>Shelby</p> Yes, NE Pennsylvania Marcell…tag:gohaynesvilleshale.com,2017-07-25:2117179:Comment:36355962017-07-25T21:07:54.704ZWayne Millerhttps://gohaynesvilleshale.com/profile/WayneMiller132
<p> Yes, NE Pennsylvania Marcellus. It was originally a lease with East Resources (now Shell) and bought by CHK. They originally honored the no deductions clause for 2 years and told their 3 (Anadarko, Mitsui and Statoil) partners it was a no deduction lease. When CHK found themselves in the financial bind they started deducting up to 110% (not a typo). They either deducted the amount exceeding royalties from other wells or deducted it next time royalties were positive. The other 3 partners…</p>
<p> Yes, NE Pennsylvania Marcellus. It was originally a lease with East Resources (now Shell) and bought by CHK. They originally honored the no deductions clause for 2 years and told their 3 (Anadarko, Mitsui and Statoil) partners it was a no deduction lease. When CHK found themselves in the financial bind they started deducting up to 110% (not a typo). They either deducted the amount exceeding royalties from other wells or deducted it next time royalties were positive. The other 3 partners are still not takinf deductions.</p> Wayne,
Thanks for the feedba…tag:gohaynesvilleshale.com,2017-07-25:2117179:Comment:36354172017-07-25T18:22:00.919Zshelbyhttps://gohaynesvilleshale.com/profile/shelby
<p></p>
<p>Wayne,</p>
<p>Thanks for the feedback on Chesapeake and their marketing affiliate. I assume in the example you</p>
<p>mentioned, that Chesapeake Appalachia is the Lessor; is this example based upon minerals located in</p>
<p>the Marcellus Play? Some of those Northeastern states hold to the "market product" doctrine concerning</p>
<p>royalties, and post production charges that are allowed. My leaseholds are in Texas and Louisiana, states</p>
<p>that I understand have an entirely…</p>
<p></p>
<p>Wayne,</p>
<p>Thanks for the feedback on Chesapeake and their marketing affiliate. I assume in the example you</p>
<p>mentioned, that Chesapeake Appalachia is the Lessor; is this example based upon minerals located in</p>
<p>the Marcellus Play? Some of those Northeastern states hold to the "market product" doctrine concerning</p>
<p>royalties, and post production charges that are allowed. My leaseholds are in Texas and Louisiana, states</p>
<p>that I understand have an entirely different approach to definitions about what "at the wellhead" means,</p>
<p>and what costs can be charged back to the royalty owner. We do try now to get "affiliated lessee" interests</p>
<p>restricted in their operations in leases that we enter into now.</p>
<p>Shelby</p> Here is Chesapeake's answer…tag:gohaynesvilleshale.com,2017-07-25:2117179:Comment:36356702017-07-25T15:00:38.254ZWayne Millerhttps://gohaynesvilleshale.com/profile/WayneMiller132
<p> Here is Chesapeake's answer to a no deduction clause. They sell it at the well head to a wholly owned subsidiary Chesapeake Marketing therefore Chesapeake Energy Marketing is taking the deductions not Chesapeake Appalachia. Here is their verbiage.</p>
<p> </p>
<p>By way, of background, gas produced from the Lease is in marketable form at the well,<br></br>and is sold by Chesapeake to Chesapeake Energy Marketing, Inc. ("CEMI") at this<br></br>point. CEMI is a marketing company, which takes title to…</p>
<p> Here is Chesapeake's answer to a no deduction clause. They sell it at the well head to a wholly owned subsidiary Chesapeake Marketing therefore Chesapeake Energy Marketing is taking the deductions not Chesapeake Appalachia. Here is their verbiage.</p>
<p> </p>
<p>By way, of background, gas produced from the Lease is in marketable form at the well,<br/>and is sold by Chesapeake to Chesapeake Energy Marketing, Inc. ("CEMI") at this<br/>point. CEMI is a marketing company, which takes title to and possession of gas at the<br/>well, and aggregates it with gas from multiple other wells into a downstream pool,<br/>typically on an interstate pipeline. The volume of natural gas aggregated in this pool is<br/>then sold to many different buyers, at different prices. On a monthly basis, CEMI<br/>determines a weighted average sales price for the gas sold from the pool at the<br/>downstream, value-added points of sale. The weighted average sales price is calculated<br/>by averaging the price received from the individual sales from this pool across the entire<br/>volume contained in the pool. CEMI pays Chesapeake 97% of this weighted average<br/>sales price (CEMI retains a 3% marketing fee which is borne solely by Chesapeake and<br/>is not passed on to you), less the costs CEMI incurs between the point of sale at the<br/>well and the downstream points of sale. The costs incurred by CEMI are commonly<br/>referred to as post-production costs, and are indicated in your royalty statement. Please<br/>note that these are not costs paid by Chesapeake but are shown on your royalty<br/>statement in an effort to be transparent.</p>
<p></p>
<p></p> Shelby, I've not tried to bre…tag:gohaynesvilleshale.com,2017-07-23:2117179:Comment:36353552017-07-23T15:44:27.256ZSkip Peel - Mineral Consultanthttps://gohaynesvilleshale.com/profile/ilandman
<p>Shelby, I've not tried to break out the the deductions by percentage owing to the fact that the circumstances can vary so widely by production location, sales point and operator. My comment as to possibly negotiating some of the deduction costs is based on the fact that my O&G attorney has done so for other clients in the past.</p>
<p>Shelby, I've not tried to break out the the deductions by percentage owing to the fact that the circumstances can vary so widely by production location, sales point and operator. My comment as to possibly negotiating some of the deduction costs is based on the fact that my O&G attorney has done so for other clients in the past.</p> Skip,
I have had difficulty i…tag:gohaynesvilleshale.com,2017-07-23:2117179:Comment:36350512017-07-23T15:40:56.322Zshelbyhttps://gohaynesvilleshale.com/profile/shelby
<p>Skip,</p>
<p>I have had difficulty in researching what percentage transportation costs represent in post production expenses. Is transportation usually considered the most expensive cost associated with sales and marketing expenses. I have spoken with some people who claim that close to a quarter of their royalty proceeds are charged back on their share of royalty expenses. I know this depends on where the gas is purchased in the process of delivery, but, in general does transportation take…</p>
<p>Skip,</p>
<p>I have had difficulty in researching what percentage transportation costs represent in post production expenses. Is transportation usually considered the most expensive cost associated with sales and marketing expenses. I have spoken with some people who claim that close to a quarter of their royalty proceeds are charged back on their share of royalty expenses. I know this depends on where the gas is purchased in the process of delivery, but, in general does transportation take the "lions share" of post production costs?</p>