Can anybody help clarify what the following letter from Mewbourne means about my mineral rights? Should we refuse?
And when I call them on Monday, what questions should I ask?
Thank you in advance!
LETTER:
Ladies and Gentlemen:
Mewbourne Oil Company (“Mewbourne”) has filed an application with the New Mexico Oil Conservation Division (“Division”) seeking authorization to surface commingle production from the wells attached hereto and all future wells located on the Leases, covering all or portions of Sections 2 & 11, T25S, R28E, Eddy County, New Mexico. All oil and gas production from these wells is to be stored in a Central Tank Battery and all gas production will be measured by a meter for each well, then commingled and sold to a common gas sales meter located on the same pad as the CTB. Information detailing each well is attached.
If you object to the either application, you must notify the Division in writing no later than 20 days from the date of this letter (the Division’s address is xxx ). Failure to object will preclude you from contesting this matter later.
Should you have any questions regarding the above, please email xxx
Ps: This letter is dated October 1, but I received it via certified mail today, December 27. Seems shady that they say I only have 20 days after the date of the letter to contest, but I receive it 2 months after the date!
You can check the USPS website tracking using the certified numbers to see when the letter was mailed and how it proceeded through the system. Delivery may have been delayed there. So you could assert this as reason for late protest. Commingling is a common way to cut costs to transfer oil and gas from multiple wells to a central collection facility and then to enter pipelines for sale. Your question might be whether oil and gas are actually being measured at wellhead or only tested periodically and proportionately allocated back to wells. Any objection must be filed with NMOCD and then you have to either come to an agreement with the operator or be prepared to present and justify your reasons at a hearing at NMOCD. This will require a lawyer. If it approved over your protest, then you will have to sue either the NMOCD or operator (depending on state law). This is Texas process and presumably same in NM. Simply objecting by a letter will not stop this. Likely not economic unless you have a large number of NMA or can argue your lease prohibits commingling.