Is it just me (?) or is there anybody out there that actually READS and UNDERSTANDS their monthly royalty statements?
I’m about ready to conclude that the oil company has purposely made their statements confusing, so that most people will ‘give up’ trying to figure them out! However, from my past experiences, that should raise some ‘red flags’!
What I’m finding on some of these past statements is:
They’re paying on some of the royalties that were sold six months ago!
Also, the oil prices never seem to match up to what they’re claiming on the statements. Of course, always in their favor, showing a lower price per bbl!
They insist upon showing all of the ‘deductions’, yet showing it always zeroed out at the bottom. One would think if your lease clearly states ‘no deductions’, there should be reason to show any deductions at all on your statement.
I pulled up the RUNS on OCC, but I have no idea how to calculate how much oil would be in each run, to even know if what they’re claiming is even in the ball-park.
I’ve contacted White Star several times, but they always act like ‘I’m the only one’ who has this problem, without giving me any straight forward answers.
Can anyone offer any suggestions/pointers or a website that explains how to go about deciphering this mass confusion?
The company will post each month the production report on TRRC. So you know every drop that has been meter out of the ground. I would personally get a oil and gas lawyer that knows your interest and how to protect it.
I've had no problems with ours from Linn and Alta Mesa but it seems that each company's statements are a little different. As for oil price the simple explanation might be that you and the producer are getting your pricing from different sources or for different grades. As for getting royalties on rights that were sold it could have something to do with when payments are made. It takes us about 2 months to get paid for royalties. If you had sold there could also be processing time to records the deeds and make ownership transfers but it's something to check out as you don't want to get royalties that you would have to repay. You may have to get an oil pro (landman, etc.) to look at your statements and explain what each item is as it's impossible to comment much without seeing them.
I also have problems with all the credits and debits the operator lists on my statements. Phone calls and letters get no answer and normally, no response. I suspect either a high degree of incompetence or devious conduct. If we share a oil & gas attorney that has some bookkeeping or accounting expierence we can get a fair shake from the well operator. Who has contact info on such a attorney??
Usually, the pluses and minuses are on processed products like gas and other than oil. They pay you (hopefully timely) and then they (operator) gets dinged on a subsequent statement that the gas price they had estimated was different than the one paid.
When I operated wells, Targa processed the gas for me and some months, i would have pages of plus and minus for the same month. The key is to check to see if the production amounts are the same and it is simply pricing that changes. If production is changing, it is worth a phone call. It is very hard to tie gas mcf with the reported RRC forms because of loss in pipeline, etc. Oil is easier to check but I bet most of your changes are not oil.
I think you're right James. I think it's only happening with gas, plant, etc., I'll have to take a look again when I get home. My minerals are in Okla., and with all of the money Ok. has made in the past you would think they'd have the top of the line websites set up (don't laugh)! lol It seems OCC is one of the worst in the U.S. (maybe, the world, haha). Gross Productions is virtually worthless, since it's never kept up to date (at least a year behind). Makes me wish, that my minerals were in Texas!! :-)
John, I've owned my minerals for a long time, so the deed is clear. Not sure where your minerals are at, but it's quiet frustrating trying to figure this mess out~ I suppose I should be like some and just figure what ever the amount the oil company decides to pay me, is 'POCKET CHANGE' that I wouldn't have otherwise had, but I like to be able to 'follow along' with how they're arriving at the bottom line! :-)
I just stumbled on this site that gives a monthly average of the price of oil and natural gas. Be sure to scroll down for a running tally for several years:
After reviewing this, it looks like my operator has been paying with a correct calculation on the oil production, but is way short (by a 1/3rd or more) on the monthly gas average.
For the gas prices, these are futures settlements at Henry Hub in Louisiana. The prices will be higher than plant prices in other locations. You cannot use these prices if your gas is sold in other states.
Kaye1, actually, the OCC has a very good website, you just have to know how to use it. Fortunately, there are simple to follow, step by step database. Instructions posted on the website. If you need help, you can call the Oil & Gas Public Assistance Department. They have a small, but very knowledgeable and helpful, staff.
Only certain information is required to be reported to the OCC by law and by Commission rule. For example, price the oil or gas was sold for is reported to OTC, not OCC. Also, only primary production is required to be reported to OCC so if your well is classified as an oil well but also makes gas, the operator/purchaser is not required to report gas volumes, only oil.