My mom passed last year. She was getting 1/8 royalties on several producing wells. (this is in Upton county, TX). I understand that this is the legal minimum we can be offered, and many folks get quite a bit more. We should be receiving the paperwork to sign from Pioneer soon. Can I take this opportunity to renegotiate the royalties, or are we pretty much stuck with what they were paying my mom?
Unless cessation of production or violation of or default under the lease by the lessee has terminated the lease, you cannot change the royalties. FYI: there is no legal minimum or maximum royalty. It’s always a matter of negotiation when the lease is initially negotiated. 1/8 used to be customary, but not currently.
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Well dang. I was hoping we could get our royalties more in line with what other folks are getting.
Thanks for the info.
You may be confusing a minimum with the required minimum royalty payment amount. This minimum amount is generally $100 and is paid when the accrued monthly royalties exceed this amount or annually if less that $100. It sounds as if Pioneer has purchased the related wells and is forwarding you new Division/Transfer Orders. These do not allow you an opportunity to renegotiate lease terms. If Pioneer sends you documents other than DO/TO, then there may be a possibility for negotiation. Contact me if you have further questions.
Thanks. We should be receiving our paperwork soon.
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