Looking for anyone that has faced a similar situation in the past or present.
I am a mineral rights owner with a small percentage ownership in a producing gas well in Texas. The Lessee (Enervest Operating LLC) has been steadily producing at this well for years and years, and we and other family members have been receiving monthly checks up until around 12 months ago, when they stopped coming. I have verified that the well is still producing and that the gas is being distributed at the customary levels via the Texas RRC website, but no indication or notice has been given from the Lessee as to why royalty payments have stopped. It's not just me, but also my family (near and extended) who have experienced this. I have made attempts to contact Enervest, to no avail. No response to emails or messages.
I have read that Enervest is having financial trouble with a failure of a very large oil and gas investment fund, but don't see how this could prevent them from paying out royalties to mineral rights owners for a gas well that they are producing from and profiting from. I live in California, and I'm unaware of anything like this happening elsewhere. What options do I have at this point other than being persistent in trying to get an answer from Enervest, short of obtaining legal assistance?
It is possible that the well royalties are under $100? Texas law allows them to hold payments until they reach $100, or annually, whichever comes first. Absent that, yes, it is possible for them to illegally take your money and spend it elsewhere. Unusual to my experience, but i have had it happen in the early 2000's with Platinum Exploration. You might get your attorney to send a demand letter to the company. Not sure that the RRC has responsibility to enforce their payments, but the other thing that might happen is that they are not paying the severance taxes to the State either, and you would have an ally against the company.
According to my calculations, the well royalties due to me and my family members should be well in excess of $100, not to mention that any royalties due would have to be paid out by the end of the tax year (December 31st, unless I'm missing something), which did not happen and were not received. Unless there's an explanation coming from the company as a result of my information requests, it sounds like I and others may have no recourse except to take some sort of legal action (a demand letter as you mentioned for starters). Thank you, James, for the response.
If you believe you are being underpaid, you should send Enervest a letter detailing the reasons you believe you're being underpaid (i.e. you were being paid up until 12 months ago, Texas RRC reports that your wells are still producing, etc). Your letter should request that they remedy the situation by paying you the royalty you are owed within 30 days. Send the letter by certified mail, and get a green "return receipt" card so you can prove that they received the letter. If you get no response or an unacceptable response, your next step would be to hire an attorney to collect.