Hello, I recently took over ownership of my mothers royalties from a well in the Desoto-Parish area, I have a question about leases. Can terms be renegotiated after a certain period? Or are they locked in. Our well has been passed to at least three different companies. I'm not even sure how to see the original contract at this point. Any help would be appreciated.
Until such time as production under the subject lease ceases, it will remain in effect as to all terms. The lessee would have to be the party to approve any re-negotiation of the terms.
Thanks for the info Skip! Also has there been any reports of people being underpaid? I see what we are getting monthly and it seems very low.
All O&G companies make mistakes in paying royalty. It's a complex process and I think they get it correct the majority of the time however if you are the one being shorted, it is a big deal. The first thing to do is check the decimal interest on the royalty statements for accuracy. If you have a copy of the Division Order, that would be even better. Divide the number of acres you think you own by the number of acres in the drilling unit and then multiply by the royalty fraction in the subject lease (for example,.20 or .25). Compare that to the eight digit fraction on your royalty statement or DO. If the operator of your unit has filed a unit survey plat for your unit, you can get it from the SONRIS database. That will show the owner, tracts size and percentage of the unit for each mineral tract.
I have done much searching for the unit survey plat section on Sonris. My eyes are crossed, I have a headache and still have not found them. Could you provide a link to find the unit survey plats on Sonris? Thanks in advance, Skip.
You have to know the unit designation such as HA RA SUA or JUR RA SU23 that proceeds the well name and you have to have the 4 digit field code. You can get both off the SONRIS well file. Then using Document Access scroll down to survey plats, enter the field code and then scroll through until you find your unit designation.
What would it mean if the unit designation HA RA SUTT does not appear in the field code 1464 list?
T15N R16W section 28
HA RA SUTT;ANTHONYFP 28-15-16H
Then it has yet to be filed with the state by the operator, and is thus in violation of the requirement to be submitted within 90 days of first production, or has been very recently submitted and the Office of Conservation has not yet approved the survey and entered it in the database.
If you are new to shale gas royalties, perhaps you do not realize that wells decline extremely rapidly during the first few years and then limp along at a very low, and perpetually declining rate. Pure physics... depleting reservoir. Odds are that there is nothing 'wrong' in your payment, your well production has just declined to a low rate. However, it is impossible to truly answer without knowing your case. There's a whole bunch of reasons your check could be lower, even from month to month, including a mistake. However, the vast majority of times, internal accounting at oil companies catches mistakes and it's made up in a future check. Exceptions occur where fraud happens but it is rare. In general, operators want your paid correctly according to the terms of the base lease.
And, in general, a lease is never renegotiated. It is what it is and you are bound by it, and your heirs are, too.