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Permalink Reply by Skip Peel - Mineral Consultant on August 30, 2016 at 2:30

Thanks, Jay.  Here is a technical industry question.  Just because they found it....do they have to keep over producing so much of it?

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Permalink Reply by Skip Peel - Mineral Consultant on August 30, 2016 at 3:20

I wonder how many of those companies charged their mineral lessors through royalty deductions to build those midstream assets and then entered into sales of those systems that locked in higher than usual gathering fees advantageous to a buyer in order to maximize the sales price?  Royalty recipients' interests are devalued on both ends of that scenario.

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Permalink Reply by Skip Peel - Mineral Consultant on August 30, 2016 at 3:58

Then it will probably keep a lot of O&G focused law firms busy for some years to come.

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Permalink Reply by Skip Peel - Mineral Consultant on August 30, 2016 at 12:13

Won't be any personal injury lawyers involved.  And it won't be ambulances being chased.  The scenario of charging royalty deductions for midstream infrastructure on the front end and locking in high gathering and treatment rates or stand by charges on the back end to enhance a sale price is something that is relatively new the best I can tell.  Do you think this combination in fact has a long history of use by a number of operating companies?  That those charges are traditional?

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