Enerplus vs Hess Deductions

In 2021 several wells I own an interest in were sold by Enerplus Resources Corp to Hess Bakken Investments II, LLC. When Hess operated the wells, the transportation charges each month were roughly $8-$11 per barrel. Now that Enerplus operates the wells, there are zero transportation charges. No charge of any kind.

Does anyone have any insight into why one company would charge what appears to be a rather large amount for transportation and the other charges zero?

It happens frequently. Some operators read the leases more carefully than others. And some operators do not want the potential for lawsuits, so they do not charge for transportation. Also depends upon what contracts they might have and if they are selling to “themselves.”

There are also some operators who deduct transportation and other charges out of the gross revenues, instead of listing the actual Gross Revenues and then listing the Costs on a separate line. As a result, the reported gross revenues are understated. It does not affect the net receipts. However, mineral owners think they are not being charged any costs. I am not familiar with your operators, so I do not know if Enerplus is reporting 100% of revenues with no costs or is reporting a netted gross sales.

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