Replies to This Discussion

Permalink Reply by Bill R on December 6, 2009 at 20:13

Hiring an Oil and Gas attorney out here that actually understands oil & gas dealings in Texas would cost me more than my share of my bonus monies so far. Since the majority of the family is 'old school' Texans, they believe the Landmen that set up the deals did everything in the families best interest and not the O&G companies that paid them to get the contracts and they will not 'rock the boat, because they say the O & G companies will boycott leasing from the family.
As for the addendums, yes the O & G attorney for one of the O & G companies had us sign a 'non-disclosure' agreement stating that we cannot say anything about them or the contracts. After which they immediately requested information on when our other existing leases in certain areas expire, which by clauses within the prior contracts, state that if someone request that information such as that, that we must immediately contact them with the name of the company requesting said information.
It is all a 'Catch-22' ... if you do not tell them, you are in violation of the contract and if you do, you are in violation of the non-disclosure agreement. In either case, you open yourself up to a lawsuit, even if you entered into both agreements on the up and up. If you ask me, how far I trust the O & G industry in general.... I would say about as far as "I could throw a drilling rig".

• ▶ Reply

Permalink Reply by John Avatar on December 7, 2009 at 3:05

Texas law is fairly straight forward on royalty payments. You must notice the operator by mail and demand the payment of all royalties due and owing within 30 days of receipt of your letter. This starts the interest clock running for those royalty payments due and owing for more than ninety days. If there is a title problem, request that portion of the title opinion that deals with the problem, thereby giving you a chance to cure the defects and get paid. Until you have done this, you haven't done anything. Some people get family ownership confused with personal ownership. Their grandparents or parents own the minerals and they don't really have an interest in them.

• ▶ Reply

Permalink Reply by Bill R on December 8, 2009 at 19:30

Our original lease contracts stated as one of the clauses, that if any company or agent contacted us about leasing expired or expiring leases that we must contact them. Unfortunately, we leased other properties to another company two years later and they had us sign a confidentiality agreement as an addendum to the initial lease agreement. Both of these papers required notary signoff and thus made them legal and binding in a court of law.
This addendum stated that we could not discuss bonuses, terms, royalty agreements, locations of leases, nor the leasing company or landmans name at any time until the leasing company disclosed the terms on completion filing.
So, it placed us in the 'Catch-22' when the company that held the confidentiality agreement asked us to inform them of any leases that are about to expire or have expired in many specific surveys that we hold mineral rights in and have active leases with other companies. The company then reinforced that they hold this right with a threat of immediate legal action if any terms were violated. The minimum fine would be a loss of one-half of all bonus monies and a reduction in agreed royalties. Since then, I have been walking on eggshells around any discussions about the company’s working in Nacogdoches, Shelby, Rusk, Panola, and San Augustine counties.

• ▶ Reply

Permalink Reply by Shakira on December 9, 2009 at 2:54

When you leased to company 2, did you comply with lease number 1 which required you to report offer from company 2 to company 1? Or was lease 1 on property distinct from the property leased to company 2? Expiration dates, again, are matters of public record.

BTW, contracts can be "legal and binding" with or without a notary. Just easier to prove up with a notarized document.

• ▶ Reply

Permalink Reply by Henry on December 9, 2009 at 3:05

Shakira,
Contracts can even be "legal and binding" without a signature. As Caliente has shown us, St. Romain v. Midas makes it very clear that an oil/gas company does not have to physically sign a contract for it to be in force, in certain circumstances.

• ▶ Reply

Permalink Reply by The_Baron on December 9, 2009 at 4:19

Good point Henry.

An Oil, gas and mineral lease is a binding contract. State Law states that the lessee does not need to sign. Payment of the rental and "other valuable consideration" is the proof that the lessee consents to the contract.

• ▶ Reply

Permalink Reply by Gambler on December 10, 2009 at 6:06

Can you tell me what a 12 stage frac is and if that meens it is a good well or a bad well?

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on December 10, 2009 at 6:39

In order to concentrate the pressure required to fracture the shale formation, the horizontal portion of the wellbore (lateral) is fractured in sections. The lateral is divided into sections with each section receiving a frac stage. Frac stage/wellbore sections are approximately 300' in length. The 300' stage at the far end of the lateral is perforated and then fraced. The stage is then allowed to "Flow Back" recovering a portion of the water used in the stimulation process. That 300' stage is then isolated from the rest of the lateral with a plug and, accounting for a non-perforated interval, the next 300' stage is perforated, fraced, flow back and plug. Repeat as per completion design.

• ▶ Reply

Permalink Reply by Gambler on December 10, 2009 at 7:04

alrighty then... is this a normal,good or bad thing? Im just trying to find out if i have a good well or not?

• ▶ Reply

Permalink Reply by Skip Peel - Mineral Consultant on December 10, 2009 at 7:15

Normal? Yeah, for a standard 640 acre unit. A mile square. And the well surface location within the unit section. 5,280' minus 660' = 4620'. A mile is 5280. The wellbore cannot be fractured within 330' of a section/unit line. 4620' divided by 12 = 385'. Subtract the non-perforated intervals and you have a typical, theoretical frac stage design. You cannot predict good or bad from the number of stages. There are far too many additional variables. You may wish to ask again when the completion data is available. Good Luck.

• ▶ Reply

Permalink Reply by Gambler on December 10, 2009 at 7:29

cool..thank you for the info. they told me it would be the end of dec before any of that info is available so guess ill just have to wait.. hopefuly the new year will start off on a good note.

• ▶ Reply

Permalink Reply by intrepid on December 8, 2009 at 6:38

I'm surprised at the responses by some people on here who seem to think that 'whatever you are getting is more than you had to start with so just shut the heck up and be glad to get it'.

Just wanting to know how your royalty payments are calculaated is not wrong.

• ▶ Reply

• ‹ Previous
• 1
• …
• 4
• 5
• 6
• 7
• 8
• 9
• Next ›
• Page