nonpayment of royalties and ORR

I have royalties and OORI in southwestern Crockett county. There are many, many wells which are producing. I have not been paid royalties in several months. The leases are old Producer 88 leases. There is also language in the leases that say that no charges for any reason can be taken against production. There are several operators, the main one being Occidental. I have received no income for several months on this production. I can tell the wells are producing by looking at the Texas GIS program. When I have inquired I am told that their lawyers say that expenses can be taken from production. I do not believe this to be true.

I have also read some of the old leases (1957) which state the leases are in force as long as there is production in paying quantities. I have not been paid for months.

Does anyone have any ideas as to proceed with this situation? Are there attorneys that specialize in this kind of litigation. Is this criminal activity?

Thanks in advance for any information,

I too have interests in Crockett County and have this exact problem with Epic Permian. I will be following your thread for any possible information to help. The last check I received had 90% taken out in “deductions.”

two things to consider:

  1. what is the operator’s minimum amount to cut a check, some are $25, some are $100.

  2. have seen operator’s go back and ‘re-interpret’ leases, to now take out deductions.

Let me be clear, I AM NOT SAYING it legal, or correct, however, some are doing it to lessen their royalty burden

Im not sure your best way to proceed, and reinstate the non deduction language in the actually check, but there are many on here that can. Most likely you will need to hire anattorney.

good luck to both of you!

Keep in mind that if the language of the royalty paragraph indicates that royalty payments are made on the value of oil or gas “at the well” or “at the wellhead” or “at the pipeline” or similar language, recent Texas Supreme Court decisions have held that certain costs can be deducted even though the lease says elsewhere that costs should not be deducted. You really need to have a Texas oil and gas attorney review your lease and your royalty statements to determine whether the language of the lease allows cost to be deducted. It is not dependent only on the “cost free” language that your lease may have in it. it is frustrating that courts appear to have ignored the plain language of the lease, but that is what has happened.