Replies to This Discussion

Permalink Reply by layla on April 19, 2012 at 14:31

You betcha.  We had an issue with ownership with some of our family's property beginning in December 2010.  The issue was resolved in July 2011which corrected the problem retroactively to the original error in the 1930's.  ECA corrected the mineral interest effective with August 2011 royalties (the October 2011 payment).  Since that time, we have been getting the monthly runaround about where the money is to correct the underpayment from late 2010 through July  2011.  When the problem came to light, they were able to begin witholding part of the payment by the following month but somehow they can't seem to get the reverse (giving us the monies back). Usual explanation is that "it's our new computer system" that they just can't seem to get to work correctly.  Funny thing-this is an international company and one of the largest natural gas producers in North America and they just don't seem to be the least bit concerned about a faulty computer system which I would have been a major concern to such a large corporation.  My last communique with them suggest that their people look into taking action against the firm that sold them their computer system.  Actually, I think they are just running the same sorts of delays, obfuscations, dare I say, scams, that many of the other o&g have been.  Did I hear someone say CHK?

 

Hope you have better luck than we have had so far.

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Permalink Reply by kittycatmama on April 19, 2012 at 14:46

No I haven't had better luck. I was curious to see if our family was the only one getting this explanation. Thank you for responding. I am like you, it is hard to believe that a company as large as Encana can't get a computer system fixed in a year's time. THEY made a mistake on our minerals. That is why people really, really need to look over their division orders and learn how to read that decimal interest before signing. We caught a mistake in our decimal interest and the saga began

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Permalink Reply by HBP on April 20, 2012 at 2:34

Or if you are in Louisiana, you may always consider not signing the division order.  Just send them a letter confirming address and SSN or Tax ID.  They have to pay you even if you don't sign (unless there is some other issue or requirement keeping the money in suspense).

 (In LA) If the Lessee is dragging around on adjusting back payments, send a demand letter that complies with mineral code 31: 137, et seq.  Or see an attorney familiar with these issues about the same.   Document all instances where they gave you the same or similar excuse over time, just in case. You are correct that after they have had a certain period of time, there is really no excuse on making these adjustments.

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Permalink Reply by kittycatmama on April 20, 2012 at 3:29

We did not sign division order, called them to show them THEIR mistake. After 2 months, they agreed with us that they had made a mistake on our agreage amt. That was almost a year ago. They still say their new computer system cannot compute back to sale decimal corrections. We are talking a lot of money that they owe us.

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Permalink Reply by HBP on April 20, 2012 at 4:20

I think that even if they respond to a 31:137 demand letter with this computer glitch as their reason for non-payment, a court could see the long history of that same excuse prior to your initial demand and find it unreasonable due to the fact that almost anything of that nature can be corrected in a year's time.  I think Encana knows that and may find a way to disburse the adjusted revenue once put on formal demand.  Do you have documentation that they agreed to the new acreage amount (revised div. order, or an email)? 

 I have worked with Encana/SWEPI on R.I. adjustments on behalf of clients in the past year and Encana was able to adjust back to date of first production on future checks.  They also have had no issue adjusting deductions back to date of first production to take more money out in most cases. Computers work fine for deduction adjustments.

Good luck to you on this - just looking at what you have presented, it sounds like the facts are on your side.

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Permalink Reply by kittycatmama on May 4, 2012 at 12:50

I do have it in writing from the co. we are leased with who got it from Encana showing Encana made the mistake. As of May 4, Encana still not able to correct mistake

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Permalink Reply by P.G. on May 4, 2012 at 15:54

I wonder if they told the IRS they couldn't pay their taxes due to a computer problem what would happen?

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