Replies to This Discussion

Permalink Reply by RONNY on January 23, 2013 at 0:25

Jay,

I ain't asking for nothing free.  If Petrohawk had been deducting transportation costs from the very first check I would be able to more readily accept it.  I'm just a little miffed the rules have changed in the middle of the game. You need to remember the O & G companies are already getting 80% of "MY" gas. To take another 30% of my paltry 20% seems a little excessive to me, regardless of your opinion of my opinion. 

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Permalink Reply by Granpa on January 23, 2013 at 3:13

Did you have cost free royalties in your lease?

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Permalink Reply by RONNY on January 23, 2013 at 4:17

No, or I would be more than "miffed" .  I acquired the property with a standard off the shelf lease in place.  I understand I am responsible for my share of expenses. I have leases with no-cost clauses and the difference in payment is substantial.  Had Petrohawk been charging me "transportation" from the beginning I would feel less "miffed".  To start charging it a year later smells fishy to me and that is my opinion.  Maybe I would be less suspicious had I not been misled by Chesapeake about how they derive their pricing.  If  Petrohawk will now "embed" a few charges in their pre-deduction gas price their emulation of Chesapeake's playbook will be complete.  25-30% expenses is out of line, and that is my opinion.

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Permalink Reply by Hopeful About Natural Gas on January 24, 2013 at 6:38

I know how you feel as I am in the same boat. However, a friend of mine is also getting hit with a lot of expenses and she has a cost free royalty clause!

I recall CHK starting this trend with expenses. Aubrey is an accountant and they built CHK using creative financing (not all of it was bad!)  It does not surprise me that other companies are doing it. 

I try to remain "philosophical" about it and remind myself that there are some things I just cannot change. A dear friend likes to remind me that "we had nothing from it before" and that's very true..

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Permalink Reply by Shaley on January 28, 2013 at 11:35

Ronny -

Your comment "You need to remember the O & G companies are already getting 80% of "MY" gas" needs some perspective.  You should realize that 100% of your minerals are virtually worthless while in the ground.  Only after a company risks spending more than $10,000,000 per well do your minerals have any value at all and risk-free to you.  Unless you're willing to pony up some big bucks and produce your own minerals, the 75%-80% that the company retains is a bargain.  No doubt there are a number of companies out there with some shady accounting practices (you named the biggest violator in your message), but there are lots of others that are trying to do the right thing.  My only advice is to closely monitor your checks and be sure all deductions are valid.  If they're not, then be the squeaky wheel and don't stop bugging them until a change is made.

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Permalink Reply by Jo Ann Carter on February 12, 2013 at 17:07

You know Shaley, had chk been upfront in the begining and not mislead everyone maybe the perspective would be different. I not ask for anything that is not mine. I just do not want bookeeping to keep adding rules and taking more and more. If that be true, then just let the minerals stay in the ground and no one wins. I do not take kindly to being taken advantage of or being lied to. All I ask is fairness. My hats off to the companies who do not legally steal.

 

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Permalink Reply by Cayman Bum on February 12, 2013 at 12:08

Ronny, I am in the same boat and agree with you. The deductions they will start hitting you with go back to when Petrohawk did the jv with KinderMorgan. Apparantly they had to lay additional gathering and transport lines to get the same gas out that was already flowing??!! BHP-Petrohawk has just figured out how to increase their return on each well by taking an additional  10% of the royalty or of the mineral interst revenue, for those unleased. So you are getting less and they are putting more in their pocket. May want to talk to an attorney to see if the charges are legal if you were not having the deductions previously and the gas was still being transported and sold.

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Permalink Reply by Tom L Hess on February 13, 2013 at 10:21

Ronny:

I guess you should consider yourself lucky as Petrohawk has been deducting transportation charges from our checks all along, starting with our third check in July of 2011. Their standard deductions from our checks are Transportation, Treatment and Gathering.

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