I have producing minerals in McClain county that are held by production by Ovintiv horizontal well and a bays vertical well in section 8 township 6n range 4w. I know Casillas/Validus has filed for multi unit spacing, increased density and location exception applications and was hoping I might be able to get off the 3/16 royalty rate. Requested some lease terms with land man Kevin Manning with Validus to include a 1/4 royalty rate but he says because I am hbp that my terms including the royalty rate cannot be changed. Any recourse I might have to get to the 1/4 rate? Ovintiv has had my lease since 2019 and never drilled a well. They have only maintained the Alvis well started by newfield in 2015
Thanks Dennis
The landman is correct. Sounds like you are held by an old lease, probably from the old vertical well Bays Hackney well. As long as the wells that are producing under the terms of the old lease, it stays valid (Held By Production/HBP). Many of us are held by those old leases. In some cases, if they are gross production leases, they may have better wording than some newer leases that try to sneak in post production charges.
Ovintiv bought Newfield, so they did not need to drill a new well.
Casillas and Ovintiv have both filed for new infill wells in the section. Casillas has been bought by Validus and Ovintiv has sold many of their assets to Flywheel or perhaps another company. Time will tell. At least two new Alvis wells were planned. Reservoir still sitting there, so someone will probably get around to it.