question regarding unleased land charges for plug and abandon costs

Happy Thanksgiving everyone.  We have some unleased land that has a well that has been plugged and abandoned and the producing company has sent us a large bill for our portion of the cost, is this common practice? 

Chuck

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Permalink Reply by Skip Peel - Mineral Consultant on November 27, 2019 at 15:00

If you are the lessor (leased owner of the minerals), no.  If you are a Working Interest in the well, probably.  I am much more familiar with the rights and obligations of lessors and unleased mineral owners.  We have members that could probably answer from experience and maybe one of them will chime in.  Did you receive an AFE (Authorization for Expenditure) prior to the P&A?

Permalink Reply by cca on November 27, 2019 at 18:17

I don't think we got an AFE, but I'll have to check.  Thanks for your input Skip,

Chuck

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