Replies to This Discussion

Permalink Reply by The_Baron on July 29, 2011 at 5:15

Your proportiant share is determined by your net acres divided by the total acres in the unit. After the well is drilled you will receive a division order.

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Permalink Reply by JHH on July 29, 2011 at 5:18

I think the value of a well is based on its production.  The company who leased the minerals... and/or paid/drilled the well... sell the gas... report production totals to the state and that's how the parish or county determine your taxes.  I'm not sure about how the pipeline works.  I'm pretty sure if you own the surface... you pay taxes on that too... depending on its market or agriculture value.  There are a lot of people on this site who might know a a lot more about it.  Bottom line... you are pretty much at the mercy of the O/G company reporting the production of the well because mineral owners generally don't put meters at the well site to verify... at least i haven't seen that.  good luck. 

 

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Permalink Reply by Henry on July 29, 2011 at 7:48

First off, congrats. 

 

I would wait until production begins.  Then check monthly production on sonris.  The production on your statement should match the sonris numbers to within a few percent.  (There will be a slight difference because CHK reports production volume for a pressure value that is slightly different from that used to report on sonris.)

 

After that, it's pretty straightforward.  As Baron said, your division order will show your proportionate share.  Another thing I'll recommend is to verify that deductions are not being taken.  CHK has been known to take deductions out of peoples' monies, even though they have cost-free royalty clauses.  The burden is on you to ensure no deductions are being taken, and to call them and get if fixed, if they are taking deductions.  CHK's statement can be misleading, with regard to deductions, so I recommend you check my gas-price survey, and ensure you are getting the right price.

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Permalink Reply by Linda Whatley on July 29, 2011 at 8:43

Congratulations Richard.  Hope you get a really good producing well.

 

 

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Permalink Reply by RFKirkland on July 29, 2011 at 9:16

Are the O&G companies required to deduct Severance tax from your royalty checks?  It is not in my lease to deduct any type of taxes but they are deducting the severance tax.

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Permalink Reply by adubu on July 31, 2011 at 7:35

YES--Severance tax is deducted all royalty checks, but not income taxes

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Permalink Reply by j garrett on July 29, 2011 at 16:28

Baron answered your question about how your proportionate share is calculated. It'll be on your Division Order. There is nothing for you to do right now.  It'll be several months before royalty checks start and your DO will arrive before then.  It took 14 months for my first well to begin paying.

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