Signed a lease after production. I think I am owed back royalty
A lease was signed in 02/2008 on lands that we did not know we owned. Wells were already producing and I guess this is the reason that the Co. had to locate land owners. Our lease has an effective date clause which states the eff. date is as of ' the date of first production from any of the lands leased herein.' Some of these wells were completed in 2006,2007, 2008 and 2009. After the lease was signed in 2008 we received a check for payment. The payments only covered the time frame beginning 03/2008 & forward. Am I incorrect to think that it should include royalty for the time frame before that? (Whenever the first sells were made on the earliest well.) If so, there is an issue of which O&G co. would owe it. It is a case of the lease being bought or assigned to a larger co. Can anyone offer any advice? There is also an assignability clause.
Views: 29
Replies to This Discussion
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Permalink Reply by Checkmateking on
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Absolutely, you should have recieved UMI payments from all production on the property since you were unleased. I would retain a lawyer, was there signifigant prduction? Did you have a lawyer review the lease you signed? I hope you didn't sign anything that would retroactively negate your claims on the said production.
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Permalink Reply by Bobi Carr ("parker") on
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which states the eff. date is as of ' the date of first production from any of the lands leased herein
She already signed away any UMO payments.
She is entitled to past royalties.
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Permalink Reply by Missy on
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The effective date clause states that lessor knows lands are part of a unit, blah, blah. This would be where the UMO payments were erased, right?? My family member signed this (right after eye surgery) I might add, not that it would have mattered,( even if they were able to read the dang thing.) No one reviewed the lease. Landman came, explained that money was owed and needed signature to get the money. I just wanted to get an opinion before I wasted attys time/and or my $$. I have some SONRIS reports on some of the wells. I don't really know about production, but I think if I was paid for past royalties it would add up. For me, it's not about the amount as much as it is about the principle of it. I did call the company several times and they told me they didn't owe me anything past. I am sure there is a time limit on collection of past royalty. I will let my atty handle it. Thanks alot!!
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Permalink Reply by Bobi Carr ("parker") on
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Missy,
Make sure from this point forward that you document eveything in writing. No point in trying to deal with them on the phone.
GOOD LUCK
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Permalink Reply by Missy on
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I realize that now. I am glad to hear there is no time limit. These things occur to me at the most unusual times. In the middle of the night or day, in the middle of any number of other things, when I can't take care of it right then. Is this process pretty straightforward in regards to an attys time? I feel like I'm about to need a home office! LOL Maybe the back royalty will furnish one. Just kidding.Thanks guys!
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Permalink Reply by Bobi Carr ("parker") on
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I have heard differently than what "j" posted. My understanding is that there is a 3 year look back window for royalties.
It is very important that you get a qualified oil and gas attorney to look at all of the nuisances of your circumstances. Since the company didn’t contact you PRIOR to drilling it may be that some title issues are involved that would need to be cleared up.
I highly recommend Randall Davidson (318) 424-4342. He discussed everything involved and was very straight forward.
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Permalink Reply by Missy on
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The circumstances are somewhat different than normal. I had heard the 3 year time frame as well. I appreciate your recommendation and look forward to meeting him.
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Permalink Reply by Bobi Carr ("parker") on
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Missy,
Sometimes after a title opinion is completed a company will decide that they need to have a "protection" lease signed.
The title attorney could have found a possible scenario whereby there is a small chance that they were wrong on there first interpretation of ownership. In this case they could have been wrong or they could be unsure and just want to cover their bases and have a lease from "whomever" owns the rights.
I’m just trying to remind you to not count the chickens before they hatch. There are just a lot of possibilities.
I hope it all turns out as you hope.
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Permalink Reply by Missy on
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That's funny you would use that phrase! I know I say it at least 2-3 times a day. Even more, when the subject is HS. I refuse to get too excited about any of this because it is like show business, 'Hurry up and wait.' However, they are paying me monthly royalties on these wells now.
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