Last year I discovered that my lessee began deducting “expenses” in 2018, so I inquired to their owner relations department as to why they began doing so when the lease specifies they’re NOT entitled to do so, and they hadn’t been doing so from origination in 2007. Eventually they replied that they changed “platforms” and had erred in the way they encoded the lease/account, and that they would stop the deductions, calculate the amount they owe me, and refund it in my December royalty check…
The deductions were correctly missing from the December check, but the refund was incorrectly missing from the December check. So I tried contacting them again, several times, and eventually was successful via phone. First I was told the refund was in my December check, but after the representative checked she saw that obviously it wasn’t included - it’s a few thousand dollars. Next, the “excuse” was that someone in the “accounting department” would have to get back to me, but of course that hasn’t happened, and now I don’t even hear crickets. Now my January check has arrived and the refund is still missing, so obviously there won’t be any willing-refund…
So who is the right Texas agency to file a report with, RRC, or Attorney General, or do I need a lawyer? Thanks!
From my understanding the RRC will not handle these types of issues. They will handle if you think an operator doesn’t have the right to operate a well, negligence in cleaning up oil spills, etc. But not payment issues.
Options:
You can send a certified demand letter.
Hire an attorney to send a demand letter
Hire a mineral/suspended fund consultant to try and help you out.
Also, try and keep in mind that operators have thousands of mineral owners in their systems and typically just a few people on staff to help. Not to mention people having to work from home/quarantine, etc. currently. So it does take time and patience. Did you try emailing the owner relations department on top of calling? Sometimes it is easier for the owner relations to track things if you have it written in an email because they have a call/email log.
If you want to help expedite things you can also pull the check stubs, highlight the improper deductions and document the totals on a spreadsheet. Provide them with the total amount that should be reimbursed. Maybe instead of doing the reimbursement through the royalty check which requires going back through and doing a reverse and rebook (which is not a quick process from accounting) - they can cut a check and correct the components in their accounting system moving forward. I’m not sure if they would be willing to do that based on company policy or how they book things in their system, but it may be worth a shot.
I would provide them (via email) a copy of the lease and the check stubs and the spreadsheet. The easier you can make it on them with providing information up front, the quicker they can help resolve the issue.
I first emailed the owner relations department, and did so several times over several months before receiving their first reply that all would be “fixed” and the amount included in my December check. I didn’t ask them to include it in my royalty check; that’s what they wrote would be done; it was their choice. After it wasn’t included in the December check, my emails to owner relations went unanswered, so I began calling on the phone. Now they don’t answer the phone or return calls, or send a check, or anything. They also have a web-based messaging platform, but they’ve never replied to that. Presumably they already have the figures and amounts, because in their first email reply from early November 2020 they indicated as much, that the amount I’m owed had been calculated and would be refunded in the December check. At the very least, someone should have the professionalism and common courtesy to at least contact me in some/any way as I’ve been patient for many months now.
My guess is they discovered that other owners in the lease pool also are due refunds for improper deductions, and the total amount is substantial, and they don’t have it to refund. In my life experience this is almost always the case when someone “goes dark” when they owe you money. I’m not at all sympathetic re their possible pandemic-related hardships because my total income is down more than 95% and I’ve been denied all forms of pandemic assistance, and it gets lots worse from there. The least they can do is send me my money that they improperly deducted.