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Permalink Reply by Dina Broussard on July 14, 2017 at 5:58

Yes, it has and everything is in order.

Al

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Permalink Reply by Skip Peel - Mineral Consultant on July 14, 2017 at 6:01

Thanks for clearing that up and for being willing to engage here on GHS.  I wish we had more input from industry members willing to explain the processes required to establish title and correctly pay royalties. 

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Permalink Reply by Gayle N on July 20, 2017 at 9:50

I have an update, a conclusion, I hope, to the Indigo saga. We received our checks last week, but after several conversations and apologies from Indigo and the landman company. "Perfect storm," etc. It took 7 weeks from when we finished the lease. Here's what was shocking to me. The person at Indigo actually admitted to me that Indigo had started producing the well BEFORE they had the lease. Chesapeake "sold" our minerals to Indigo AFTER they had lost the least due to nonproduction--it wasn't theirs to sell--and Indigo began producing the well way before we signed with them. I asked the Indigo rep about this, and she changed the subject. I said, "No, I'd like to understand what happened," and told her my assumption. She actually said to me, "You are right. Our guys in the field--you know, engineers--sometimes do things without checking with our land department." I'm afraid I said that I wasn't very impressed with Indigo's business practices. I said it nicely (didn't have the check at that point, after all), and she apologized profusely, saying that they consider their owners very important. We ended on a cordial note. I asked a friend in Louisiana who deals with the gas business how that sort of thing could happen, and he said, "Gayle, nobody cares." 

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Permalink Reply by Skip Peel - Mineral Consultant on July 20, 2017 at 10:15

Thanks for the additional information, Gayle.  The problem here is Indigo, not Ruffin Energy.  I don't completely agree with your friend but understand why he fells the way he does.  I think a lot of mineral owners care but just don't know the basics of managing their mineral interests.  Yours is a cautionary tale for GHS members.  When royalty payments stop, they need to find out why.  And if production has ceased and does not resume for three months, they need to seek a release of their lease.  Lacking some specific language that keeps a lease in force when production stops for an extended period of time after the primary term, the lease rights expire.  Send a certified letter demanding that the operator file a release in the public record within a reasonable period of time, say 30 days.  This should get you a reply that let's you know whether the operator agrees or does not agree that the lease has expired.  If they claim the lease remains in force they should provide a reason.  That is when mineral owners should seek the assistance of an experienced O&G attorney to determine if the reason provided is legit, or not.  Taking no action can lead to just this type of situation.

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