I and some other family members are getting royalties from Haynesville Shale wells in Caddo Parish. This is through a lease we signed in 2017. We are getting division orders for an old lease that dates to the 80's for an old oil well that has not had any production since April 2019. The unit includes some of the area also in the Haynesville Shale unit. I discussed this with the company sending the orders, I questioned whether the lease was still valid since there had not been any production in over 5 years. Their response was that they were getting a small override for the Haynesville wells and this makes the lease still valid. They said they still had some oil in a tank they wanted to process, but have no plans to rework the well. Does seem to make sense?
Tags:
Yes. Many small oil operators of old wells that were producing and holding old "all depth" leases in force when the Haynesville Shale play started were able to assign the deep rights to the shale operators. Chances are the early Haynesville Shale wells went into production long before 2019.
That override is the difference between the royalty in the old lease and the royalty that the small oil operator received for the assignment. Depending on the date of the old lease, if it was a one eighth royalty and the operator got the difference, you would both be getting paid on one eighth. You got the original one eighth and the oil operator got an eighth on top of that for a quarter royalty. The usual difference is that an override is cost free while you get dinged for post production deductions.
386 members
455 members
440 members
400 members
243 members
149 members
358 members
63 members
119 members
8 members
© 2024 Created by Keith Mauck (Site Publisher).
Powered by
h2 | h2 | h2 |
---|---|---|
AboutAs exciting as this is, we know that we have a responsibility to do this thing correctly. After all, we want the farm to remain a place where the family can gather for another 80 years and beyond. This site was born out of these desires. Before we started this site, googling "shale' brought up little information. Certainly nothing that was useful as we negotiated a lease. Read More |
Links |
Copyright © 2017 GoHaynesvilleShale.com