Replies to This Discussion

Permalink Reply by RJ on February 22, 2012 at 11:16

Hmm ok, So much for the community lease. Well as for the 2%. I have  E mailed CHK about how my 3 Division orders did not add up to my Lease acres. Funny how it came out to just what yours was 2%. IM waiting on them to answer however you might also ask the same question if you have not already. Cant wait to hear their reason for this. Like I said 2% adds up fast when you count entire sections.

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Permalink Reply by robert minton on February 22, 2012 at 14:11

  I am not sure if the following scenario fits your situation, but here goes! If you leased 64 net mineral acres, and same are included in a 640 acre unit, you will receive pay based upon 10% (64/640) of the royalty figure in your lease, ie 2.0% of production from the unit. If you leased 48 net mineral acres, you will receive pay based upon 1.5% of production from the unit. If only 48 acres of your tract is included in a unit, the same example applies, or .015. You will be sharing the royalty paid on the unit, regardless of the number of wells drilled on the unit, or where they are  drilled within the unit,.BUUUUUUUT, with a 2% shortage showing up in more than one place, i suspect estimated payment, to beat penalty, or a "skim"!

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    

 

 

 

 

 

 

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Permalink Reply by Interested Amite County on February 22, 2012 at 15:27

Robert.. Can you please explain royalty interest versus mineral interest?

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Permalink Reply by Larry L on February 23, 2012 at 1:27

Good News!!! I found the "missing" 2%.

Basically CHK made an error in addition.

Specifically they added the two "community "acreage and came up with a number that was exactly 5 ac too much.

 111.939581 + 128.85344  = 240.793022  and not the 245.793022 used in their calculations. This error was propounded through their calculations and resulted in us being shorted 2%. I have written to them, and will wait for them to revise the Division Order, because as it is now IT IS WRONG.

Math, unlike politics, can't have two opinions.

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Permalink Reply by RJ on February 23, 2012 at 5:21

Wow way to go Larry. In my original post division orders Katie from CHK responed and said she would help us out if needed. I got an e mail with a letter from CHK that shows how they calculate the acres and share you get paid. No other comment from them on the 2%. Did not help me any. THe letter was from the person who figured the data in the top right hand corner of your division order. You really think they will admit to an error??? Guess we will see.

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Permalink Reply by RJ on February 24, 2012 at 1:28

Larry Cant wait to hear what CHK says about your numbers!!

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Permalink Reply by Larry L on February 24, 2012 at 2:07

The "missing" 2% , which represents 5 acres has been accounted for!

The owner of the 5 ac is part of our community lease and owns it in section 32.

Therefore they need to redo and resend ALL DOs, because they are WRONG.

When we get the corrected ones it should accurately represent the acreage each owner has. This time, however, we will have interest in THREE sections (30,31,32). Currently each are producing. Although the unit interest in the Tucker 32 well is small, it has been producing since June 2010 (which we should retroactively participate in)

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Permalink Reply by Larry L on February 23, 2012 at 2:32

By my calculations the mineral rights owners represented by this particular "community"

lease just put 3.8 million dollars in their pockets over the life of the lease.

Yes. ADDS UP REAL FAST!

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Permalink Reply by DrWAVeSport Cd1 on February 23, 2012 at 5:53

Larry,

I would never give CHK the "benefit of the doubt."

IMO...CHK doesn't make those kinds of "Mistakes".... (?) 

"$3.8 Million" multiplied by (?)...

Thanks for posting/sharing your information.

DrWAVeSport Cd1 2/23/2012

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Permalink Reply by Larry L on February 23, 2012 at 9:16

Personally I don't think it was a "sin" of comission but of omission.

Somebody got lazy and wasn't watching the details. My concern was why they didn't catch it earlier after a number of people posted here as well as emailed and phone calls alerting them to the discrepancies? I know they must deal with uninformed and irrational owners daily...but no excuse IMHO

Next thing to watch is to see if they try to post date the DO back to Feb 13, or if they will date it today Feb 23?

And finally I trust we don't need to remind them that interest has started accruing from the 121st day after production.

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Permalink Reply by RJ on February 23, 2012 at 11:53

The Baron had a point. He said thats why they say amount of acres more or less.

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Permalink Reply by Skip Peel - Mineral Consultant on February 23, 2012 at 11:58

Few sections listed as 640 acres are actually 640.  Standard sections always seems to have a small variance when modern surveys are performed.  And a survey of the section and each tract is regularly performed as part of a Division Order opinion.

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