Replies to This Discussion

Permalink Reply by PamelaC on February 2, 2011 at 7:38

Crockett Well #1 --- SM Energy pays 95%, Encana will pay the other 5%. These are the figures from SM Energy.

 

I have several prices you can add

 

8/10 = 3.81

9/10 = 3.73, 3.78

10/10 = 3.44

11/10 = 3.27

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Permalink Reply by Henry on February 2, 2011 at 8:38

Pamela,

Can you tell me two things?

1,  Where is your well located?  Either Section-Township-Range (if you are in LA) or the Survey and County (if you are in TX).

2.  Do you have cost-free royalties?  I'm guessing you do, but I'd like it confirmed that the prices you showed are the gross price (after severance tax), and no other deductions have been taken.

Thanks.

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Permalink Reply by Linda Whatley on February 2, 2011 at 9:14

Henry,

 

I was told by someone who is in the know, that they can't take out severance tax until the well is paid for.  Do you know if this is correct or not?

 

 

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Permalink Reply by FXEF on February 2, 2011 at 11:32

Linda,

 

STATUTORY CITATION: R.S. 47:633(7)(c)(iii)  

On any horizontally drilled well or any horizontal recompletion from which production commences after July 31, 1994, all severance tax shall be suspended for a period of 24 months or until payout of well cost is achieved, whichever comes first.  Payout of well cost shall be the cost of completing the well to commencement of production.

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Permalink Reply by Linda Whatley on February 2, 2011 at 16:57

Thanks FXEF......  you are one of the best!!!

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Permalink Reply by diana canady on February 2, 2011 at 17:21

What if some severance tax WAS withheld from a horizontally drilled well (prior to payout of well cost).  If it was not supposed to be held out, then is there a tax form to fill out to get it back when you pay your taxes? If not, then what do you do?

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Permalink Reply by Ben Elmore on February 3, 2011 at 4:03

Just to be clear, this is only the rule in Louisiana, not Texas. 

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Permalink Reply by diana canady on February 3, 2011 at 4:44

Thanks for the clarification.  I am talking about Louisiana, though.

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Permalink Reply by Linda Whatley on February 3, 2011 at 4:52

FXEF,

 

Does that statute just apply to Louisiana, or is it a Federal Statute?

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Permalink Reply by Ben Elmore on February 3, 2011 at 5:25

That is a Louisiana statute. 

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Permalink Reply by Linda Whatley on February 3, 2011 at 5:26

Thanks Ben. 

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Permalink Reply by FXEF on February 3, 2011 at 5:34

Linda,

The statute I posted in a previous post only applies to Louisiana. Each state defines severance of their minerals differently. The link below may help explain the guide lines for surrounding states. 

http://dnr.louisiana.gov/assets/docs/energy/newsletters/2009/2009-0...

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