Fayette and Lavaca County TX Oil Activity

Simply put, it is a supply and demand issue. With so many people, globally, working from home, no one is traveling, driving, spending money. The demand for oil/gas has shrunk significantly, thus, we have a surplus and now the midstream companies are going to be put into a situation where they have to ask producers to shut their production in.

A few things to note… You can’t shut in an oil well and make shut-in payments, that is only for gas wells. So unless you intermittently flow the oil well every 60-90 days (typical cessation of production clause), you’re stuck with paying royalties unless you want your lease to terminate.