I have been suspicious about hiding expenses on a different operator. What are some things to look out for on a statement?
Just looked at my recent Permian royalty statement and see deductions for âOilfield Clean-Up Regulatory Fee (Gas)â and âPurchaser Gathering Adjustmentâ that look out of the ordinary to me. Is that what others are referring to or what other hidden costs?
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Yes, deductions have included compression and purchaser gathering adjustments, both are in violation of our lease and these costs might have been hidden prior to the Colgate/Centennial merger, now they have come to the forefront.
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Oil field clean up fee is usually not out of order.
Purchaser Gathering Adjustment is a purported expense being charged against you IF it shows up as a deduct against your royalty percentage. The term is a new one, appearing in the last few months.
Hidden costs that are being referred to herein are when the Operator reports basically nothing to you, but pays you a rate that they have self-developed to reflect their gross sales less whatever expenses they have opted to apply to the well. Many leases and other agreements no longer allow expenses. You have to be able to use the Comptrollers website to see this sort of thing.
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Our wells were operated by Centennial, and we never had a problem until these young hoodwinks took over, the âentitledâ generation. The are all working, probably at our expense, for their $25,000,000 bonus based on performance.
If anyone finds an answer to our problems with Permian Resources, please reply to this site.
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Iâm trying to get some legal help now with Permian Resources. Are you still having problems with them? I thought I read from one of your posts that your lawyer contacted them and they had reversed the deductions and reimbursed you. Still having problems?
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Operators do not have standardized systems from operator to operator. It is especially difficult during a transition or acquisition to merge each groups systems and procedures. CDEV had good systems which they developed over a longer period of time and over more acreage, from what I heard. Colgate was smaller and did not need the sophistication (oil and gas accounting is not as simple as you think) of CDEV, but I assume they are likely swimming in the weeds now that they grew to such a large position. Life is a lot easier as a mineral owner than an operator. Those young or not, entitled or not, many of us hoodwinks have worked very hard and have bet on ourselves to try and build something. The Colgate boys are no different.
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Please furnish us with a link to the Comptrollerâs dept. that can furnish this info. Thanks.
I plan on contacting Nicholas Miller concerning the Permian deductions. He has helped me before on my Amendments to Leases in the past. It is my understanding from reading the posts, the issue will be resolved for those that hire an attorney. Others, not so much
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Colgate should be sued for hiding these costs. All of the mineral owners will have overpaid their taxes because Colgate didnât report the proper gross sales amount on the 1099. Percentage depletion is being understated due to this.
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Texas class action firm Burns Charest in Dallas was recommended by Ryan & Wilson in Oklahoma City.
Ryan & Wilson have successfully served as co-lead class counsel in over a dozen oil-and-gas class actions, resulting in over $200 million in recoveries including litigation with PetroQuest $45M, Marathon $35M, Ovintiv $19.5M. I was personally reimbursed from the resulting settlement with Ovintiv.
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Since October of 2022 my checks have gone down $3000. We are not a big owner but we certainly would like to have a fair accounting. Please let me know if there is a class action going on or someone with whom I should check. Small potatoes but potatoes!
The price of oil and gas has dropped significantly since Dec 2022. Also, your wells naturally decline in volumes produced, so that is the logical answer.
If you are specifically asking about this thread, then you may have another layer of complexity.
Since I appended the question to this thread you might realize that I was indeed asking about the subject of the thread. I did see your earlier answer to another person and am aware that revenue lessens over time. Ordinarily however, I believe that it does not lessen by thousands suddenly right after property is transferred to Permian .
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Our family might be interested in joining a class action suit against Permian. Is Ryan and Wilson in Oklahoma the same firm as Bradford & Wilson which you referenced in any earlier post? Are they not interested in a class action suit against Permian? Do you have any further information on Burns Charest?
A class action might be forthcoming, it is possible. Yes. I contacted Ryan Wilson at Bradford & Wilson in Oklahoma with questions about class actions. Ryanâs response was:
âGiven that the issues are in Texas, however, this falls outside of our typical purview, so I would suggest contacting Texas firms that do this sort of work. One reputable Texas firm that comes to mind is Burns Charest LLP.â
I have not contacted Burns Charest. Right now Iâm working with attorney Patrick Flueckiger who is listed in the directories of this site for legal services.
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One major hurdle for certification of a Texas class action suit is that the oil and gas leases will not have identical royalty clauses. Texas law allows the deduction of post-production costs unless the lease contains language profiting the costs. There are several recent cases which have held that a general clause prohibiting deduction of expenses was overridden by other language in the lease. The Yetter law firm has a good discussion on royalty class action suits. https://www.yettercoleman.com/wp-content/uploads/2022/11/Royalty-Litigation.pdf.
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I am well aware of changing prices and declining production over the years. But production does NOT decline 30 - 40% overnight and stay that way unless Permian Resources is involved.
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Have you charted the production volumes for each well from date of 1st production forward? Looking at Centennial well drilled in 2018 and now operated by Permian. 1st year 2018 to 2019 oil bbl fell 78%; 2nd year 2019 to 2020 fell 59%; 3rd year 2020 to 2021 fell 28%; 4th year 2021 to 2022 fell 23%; 5th year 2022 to 2023 fell 14%. Centennial and Colgate merged Sept 1 2022 and then renamed consolidated company as Permian Resources. This is not a rare well decline and mostly while Centennial operated. I see similar declines for wells operated by other companies.
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Helen hired an attorney or deductions not specified in her lease She had to hire an attorney and there were discrepancies . I plan on hiring an attorney as well. Itâs not production, it unauthorized deductions