Hello Folks I am curious about the lag time to receive proceeds once a well has been completed. SWN drilled 4 wells near our land in Pelican, LA. The well numbers are:
If I am reading Sonris correctly they show the wells were put into production at the first of May 2023. We have not gotten division orders or revenue statements as of yet. Is a 3+ month delay normal?
Thanks for any insight you may have.
This is a normal thing for Southwestern. Usually a 3 month lag before you should see any payments is not uncommon. What ever date you see on Sonris as the starting date should be when the back pay starts. Good luck and Congratulations.
Thanks for your help Brent!
Three to six months is the usual lag time.
Can you help me? I am being told, we are in the 7th month since production began. I contacted SWN who sent it to their "inquiry" analysts. Lag time on that request could be another 2 weeks. Acc to the support line, no ownership names are on the file for these wells. Has SWN been paid for the production? is it held in escrow or do they have access to it? I wonder how other companies can handle this task in much less time and SWN is given a pass. Just so disappointing we feel manipulated. We are only looking for answers not meaning to air out complaints to you. Any guidance would help.
Feel free to send me info on your services. Do I need to contact my local attorney? He lives close to SWN's home office.
Thanks a lot.
Hi, RC. I've seen first royalty take up to eight months although that is relatively rare. SWN acquired existing producing HA units from Indigo and GEP Haynesville and may be taking time to check the accuracy of the pay decks from those two companies. That seems to have happened in other instances. How did you contact SWN? Do you have a record of those communications? Email is best. Royalty is normally paid late in the month for the production two months previous. I wouldn't consider doing anything until the end of this month. If you haven't received payment for all the months back to first production by then, let me know and I will refer you to my O&G attorneys. They can tell you what they have experienced with SWN and what your options are. I know it is maddening to wait on payment when you already have an established decimal interest and prior payments but SWN and other HA operators do what they will and push the envelope on what is allowed under state regulations and the law.
I wanted to respond to the current talk about late payments with SWN. We have six adult families involved in our minerals with SWN. My older brother has had many conservations with them about this issue. SWN tells our family these wells are very complicated to figure out and that they are working on the issue.
We took our concerns to the office of conservation in Shreveport and they said the ownership should not have any problems because our property and minerals has been in our name for over 50 years . There is a very nice guy there Patric said ours was so very clear cut there should not been any reason to pay our family for what they owe. We own large acreage in 19 14 n 14w .
The previous two wells in which are HC 18 14n 14w thru 19 14n 14w thru 30 14n 14w holly field we have gotten since 2021 and the current well we haven’t been paid for which is the exact same path we have not gotten paid and the well has been producing since Jan 16 th 2023. We can’t figure out why they can’t pay some folks that they know they owe. We just don’t understand. Can you give us any speculation on this situation. Perhaps if something don’t happen soon we would like your attorneys info please. We are patient folks and are very grateful to be blessed by this but this time limit thing is getting a bit too long. Any info you can offer our families would be very appreciated. Also
I know Patrick Raley and much of the staff at the Shreveport District office of the Office of Conservation. They are conscientious and capable but you're asking them about title issues and they don't get involved with that. The state does not get involved in payment disputes between operating companies and mineral lessors. You're not the only one who is dealing with delayed payments by SWN. I know it's frustrating. Here is my best guess as to the reason.
SWN acquired existing HA units and wells from GEP Haynesville. GEP Haynesville acquired those units from Encana and many of the original unit wells that Encana drilled were very early in the play. The sections you reference were drilled in 2009 and 2010. That was early in the rush to drill up all the acreage that had been leased and many of the Division Order title reviews were rushed and contained errors. As long as Haynesville operators were drilling one unit wells, there was little reason to go back and attempt to identify and correct those errors. When the state chose to allow cross unit laterals and operators started to drill wells that produced from multiple units, those errors became a concern for all operators, not just SWN. Legal departments warned of complicating existing payment problems.
SWN has maintained an aggressive drilling schedule since they acquired their Haynesville rights from Indigo and GEP Haynesville and they are drilling a lot of multi-unit wells. In your case, three units (sections 18, 19 & 30). It is a good idea to research, identify and correct the decimal interests of all the mineral lessors in all of those units. I suspect that is the cause of the delay. I suggest that you wait the remainder of this month to see if royalty gets paid on the new well. If we go into October and you still have not gotten paid, let me know and I'll refer you to my O&G attorneys. I believe, and they can verify, that royalty payments delayed beyond a certain length of time are subject to interest. That doesn't happen automatically, you have to make a demand and it must be done a certain way. Not knowing how many acres you have and what the amount of that interest might be, it's impossible to know whether it would be more than the legal costs you would incur. Let's wait a couple more weeks and let's revisit this.
RC, you're welcome. You will find no assistance in this matter from the state. Forget it. Other than continued communication with SWN, the only recourse you have is to get an attorney involved. That will not resolve this quickly. You will run up a bill and then, in a few weeks, SWN will start to pay you.
You are far from the only mineral lessor with this situation. SWN is swamped with title due diligence trying to keep their problems from getting worse. They have significant incentive to get those Division Orders corrected. They have no incentive to start paying you before they amend the DOs for your unit.
Some members will remember when many royalty recipients received many page royalty statements going back to first production that showed they had been overpaid. This was some years ago and began when HA operators started drilling those multi-section cross unit laterals. I think that their legal departments were aware of the mistakes in the Division Orders. Before those cross unit lateral wells, there was no need to try to correct them unless a mineral owner in a unit challenged their decimal fraction. The legal departments realized that cross unit lateral wells were going to compound those mistakes.
We don't talk often enough about how important it is to have a copy of your unit survey. Without it you can't know the acreage assigned to your tract, the unit acres and you can't calculate your eight digit decimal. The HA operators tried to keep those surveys out of the public record for ten years. They didn't want the potential headaches they would cause. Now the number of delinquent unit surveys are a relative few compared to when I started lobbying the state in 2018.
I just got an statement from them via EnergyLink with proceeds from January through June and backup withholding because evidently name, address and email are not enough to send a DO or W9.
Quick question Dallas - was the first check a combination of the previous months? And the successive ones; do they have a 2 month lag? Thanks for your help RC