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Permalink Reply by Donna Thornton on August 18, 2010 at 6:12

Hi James. Just joined this group and I am sure you have this all worked out by now but may be this will be helpful for someone else. I am in a very similar situation but in reverse. I know....huh? I leased to Chesapeake, EnCana drilled, SWEPI is operating, and for the new twist, Chesapeake sold 20% of my lease to PXP. Chesapeake participated and I did receive my 80% royalty from them but had not heard hide nor hair from PXP. I ended up having to call PXP and they told me they had not participated and were unaware that the well was producing. The answer to your question is yes. They (CHK, in your case) is responsible to begin paying you within a timely manner (I think, 120 days after production begins) even though they will not be reimbursed from the well operator until expenses are paid 300%.