Grady County, OK - Oil & Gas Discussion archives


FYI pooling order in Sect 28 8n 5 w provides $4000/ac with 1/4 royalty


I received a court notice today outlining the settlement of the Strack vs. Continental Resources case. More details including wells affected can be found at Settlement total is $49,800,000. for sub-class 1 members. There are a lot of wells effected (21 pages worth!). The settlement was approved April 3rd, and people do not need to do anything to participate in the settlement, unless you want to Opt-out, or object. Fairness hearing on attorney's fees is scheduled for June 11, 2018.


That's "wells affected" (21 pages...


James: I, too, received the notice. As a retired lawyer, far be it for me to complain about lawyers' fees, but in addition to the $49.8 million they also get up to an additional $1 million for "expert and consultant fees, litigation expenses and Administrative Expenses." Paid from the distribution amount due to royalty owners, not by CLR. Plus, the four trusts that were nominal plaintiffs get a hundred thou each, also from the distribution.

Sounds like a kind of a rip-off.


Good Morning!! Does anyone know of a way I can research the sale of property way back in the late 1960's or early 70's? We're having a discrepancy on how many acres mineral rights we actually own. Also, if one company has leased rights another one can't come in and lease the same spot, right? I know this sounds a little off, but CLR is telling us we only have half the number of acres that we think we do. If CLR is correct, then I have 2 leases for the same property and have done so for the last 4 years!!


Oops. I forgot to make that 40% of the 49.8 million. That would be almost 20 million for legal fees, without the awarded costs.


Sylvester and James (if I may):

If you've looked at the Settlement Agreement at the Strack website, doesn't it appear that CLR alone will decide which owners' lease clauses specify "Express Deduction" and "Express NO Deduction"? This struck me as odd, given that the entire complaint was based on CLR's casual (not to say high-handed) interpretation of those very lease clauses. After all this litigation, is the fox still the guard at the hen house?


David: Let CLR do this and bear the costs of reviewing all those lease agreements. Hard for them to ignore express language. But...I have a couple of leases with "no deduction" clauses and will write them to make sure they read them correctly. Four of my wells are on the select list.


It looks like some OCC proceedings have been happening in Section 8-06N-06W. This section was controlled by the Kaiser drilling company. Did the mineral owners force something to get this opened up to other drilling companies?


8-6-6 was leased by Kaiser-Francis. Is CLR getting involved in this section?


Just for information purposes: for those with interests in Grady County Section 32-08N-08W, I received a verbal offer today to lease my (teeny) mineral interest for a 1/4 royalty with a $2502 bonus per nma. Looks like Camino Nat Resources is interested.


Make sure you get in writing. once they have the lease no one will talk to you. I called at least 10 times to them about a lease that they bought from Ward, I know that my 95 nma is not at the top of their to do list. left messages with ron burgess an Andrew likens.


Papa G, K-F is the operator of the McNeil 1 well in the section (nice 4 BCF well-Morrow Springer). They can sell or trade or whatever to any other operator the rights to other horizons. They still have a piece of the pie in the section. Echo Operating is wanting to drill three horizontal Woodford wells. Continental is on the respondents list, but not as operator.


Diane, the first and cheapest solution is to ask Continental for a copy of the paragraph in their title opinion for your tract. If it was sold, it should show up in the title opinion.

The alternate and slightly more expensive solution is to hire a land man for a day to go to the courthouse and hunt for the answer. Or you can do it yourself if you live in the area.

On the leasing part, It is possible to have two leases if you had a depth clause on the shallow reservoirs and then another lease for the deeper reservoirs. Rare, but possible.

Start with Continental first. You said 4 years. The first lease may have expired after three years and then a second lease was taken so they don't overlap in time.


M Barnes, Thank you again for your knowledge. I know Echo has purchased quite a few acres from family members in Section 5, just curious if 1 of 3 wells might be a multi-sectional into 5. Is there anyway to find out? I guess CLR would have to provide them access to via sell or trade to do a multi-sectional from 8 into 5.


Papa G, reading the Increased Density hearing, looks like there might be four wells-the current well being requested and three more after that. The current well requested is only in Sec. 8 165 feet FSL and 330 feet FWL to 165 FNL and 330 feet FWL. Leaves room for the other three wells. Hearing was supposed to be on April 23. Exhibits should get posted eventually. They weren't there when I looked this morning. EUR (Estimated Ultimate Recoverable) usually part of the Increased Density hearing. Map of well locations should be there as well. Continental has their own thing going in Sec 5. Not sure about the three extra wells at this point.


I have mineral rights in 4-8-7 in Grady County Can anyone tell me what is going on there?Thanks.


Shelby, Continental has a pooling pending, so if you are not leased, you need to be ready to sign within 20 days when the order comes out. Do not be late! TPR Mid Continent is also in there with a pending pooling. Not sure who will win. Looks like a horizontal well is coming.


Regarding the Strack vs. Continental litigation, I went back to look at the three leases we have with Continental--they are all from 2011 and the three wells we get royalties from (all started production in 2013 and 2014) are listed in the lawsuit. My mother is the mineral interest owner and has been since 1981, but she never investigated how to protect her rights as a MI owner during that time and pretty much had the attitude "it's free money, so I'm not going to be greedy." She would generally accept bonus offers without negotiating for more, and didn't worry too much about protecting her rights.

I'm her daughter and heir, and I took over as "manager" and secretary for her mineral interest back in 2011. I have a slightly more aggressive business approach in that I try to negotiate for higher royalties and bonuses and I now ask for the standard Exhibit A clauses on all leases. Apparently our leases with Continental were entered into before I joined this board and learned about the importance of Exhibit A clauses. Hence, our leases with Continental lack the "no deductions" clauses, which I undertstand to mean we won't receive any payout from the Strack lawsuit. I'm kicking myself for not learning more about protecting my mother's rights sooner!

There are certainly other companies deducting unfairly from royalty owners, but how would one determine this? Can one see if "illegal" deductions have been made by carefully examining those pages of figures that accompany royalty checks? I admit I don't have the patience to comb through those I don't know what I'd be looking for, exactly. Is there someone here who knows how to find illegalities in royalty check receipts who can pass along that info?

Perhaps this is related...I noticed last month while compiling royalty info for our tax preparer that a couple of companies we receive royalties from listed "other deductions" in addition to "state tax" and "production tax" on their 1099's. I don't recall seeing those "other deductions" on 1099s before this past year. Does anyone know what those "other deductions" may be? Is that a red flag to look more closely at exactly what a company is deducting from royalties? And again, how exactly does one determine if there are deductions being made illegally?


Thank you Mr. Barnes. I am currently under lease. I just have no clue what the status is of any proposed drilling.