Oil prices have dropped due to a oil glut, but exporting oil would increase production and prices. Also, crude oil and heavier natural-gas liquids like pentane produced from gas fields are still on the US Commerce Control List as items in short supply. Operators will just have to drill more wells to disprove this short supply theory that’s been used to scare people since the 70’s. Just recently, Devon filed for increased density in many sections in Payne County, so they know what needs to be done.
Recent oil price drop not justified, so price goes up as more gasoline is consumed. “WTI rallied 1.1 percent to $82.70 after declining as much as 2.5 percent, on speculation prices have decreased more than justified.” See ‘Oil Rebound’ at bottom of Bloomberg report Oct 16, 2014 http://mobile.bloomberg.com/news/2014-10-15/asian-futures-signal-lo…
I just received the pooling order for Sec 4 19N 1 W Payne. I’ve never been pooled. I’m tempted to participate. This well is split between sec 4 NORTH HALF only and Sec 33 20N 1W. Sec 4 is allocated only 33.8%. They say it’s a multiple unit and is only pooling sec.4. Any thoughts on this?
Tyler, AEP has a permit to drill a Mississippian Horizontal (MH) lateral from a surface ‘spot’ location in Section 9-18N-01E into the ‘lease’ of Section 8-18N-01E. That means the rig pad is physically located in Sec 9, but the producing ‘down hole’ location will be in Sec 8. If you own clear title to minerals in Sec 8, you should be paid for your royalty interest percentage of the production. AEP has 6 months after the date of the first sale of production to start your royalty payments without being required by OK statute to pay 12% interest on late any late payments.
Clint posted a Spud notification for 09-18N-01E. The name of the well is Yost 08-18N-01E 1MH… Section 08 is my location and has not had any drilling to date. Been waiting a long time for some activity… Why would the well be named Section 08 but drilling in 09? Clint, thank you for posting drilling records, Very informative and useful.
Martha… Thank you for the information. Awesome news!
I received a letter from the oklahoma oil and gas registry. They want 35.00 a year. Is this necessary??? Do I need to be registered???
G. Win, if your contact information is up to date at the courthouse in the county in which your minerals lie, anyone searching for you will never get to the mineral owner registry. I mean, do you keep looking for your car keys after you find them? Of course not. The courthouse search will come first. If your contact information is up to date at the courhouse, anyone looking for you will find you. I would much rather record an affidavit of identity at the courthouse which is good for as long as your contact information does not change and does not cost $35 a year.
Thanks rw. I will do it at the courthouse!!! Thank you!!
Martha, you have said that oil companies have to pay interest on production after six months of completion of a well. I believe 12%. I think you also said that if you had a clouded title and then cleared the title that you could get 6% interest. Devon drilled a well in Sec 7 18N 01E, the Hopkins1-7 MH, in I think March or April of 2013, I do not have the completion report. After doing a Quiet Title suit I got the title clear and got my first check in April of 2014. My question is do they owe me anything.
Martha, you say to “know everything about our minerals” - as a novice I know the legal description and some details from royalty checks and what I read in this forum, what else do I need to learn and how ? And you ask “do you know how many wells are yet to be drilled”, I don’t where to look for that either. I hate to be asking so many questions but I too am getting tempting offers to sell and with low gas prices and sorta dismal predictions for an upturn I’m on the fence. Thanks to all you experts
I have 20+ minerals in Section 27 18N 1E. I am getting royalty payments from the Phillips well in the SW/4. American Energy -Woodford just had a hearing for an emergency application to establish a 640 acre spacing. My question is does my royalty interest decrease because the spacing is much larger than it is now. Also, I am getting royalty payments from Devon on Sec. 7 18N 1E. How do I know if I am getting all the payments I should from the production. Any help would be appreciated.
Sorry for all the questions but how do you know if you are getting all the royalty payments you should. I am considering selling some minerals and the mineral and royalty conveyance documents say that I would be giving up my right to any production due to me before the date of the sale. I have been told to have them strike that clause or be sure I have received all of my production payments to date.
Steve, For further info. study the Bakken. North Dakota was covered by the Western Interior Sea also, but the sea was deeper in ND. There will certainly be more wells drilled in Payne, because that is the nature of all horizontal shale developments. Drilling vertical wells are like using a straw to drink from a cup, you can hold the cup in one spot, sip from one straw and drain it fairly quick. Horizontal wells are like using a straw to drink off a plate, you have to keep moving the straw and you will need more than one straw if you want it quick. The Bakken is a deep plate and our area is a shallow plate. The Springer is the newest formation in our area and it is proving to have less fall off production. There are no public reports on the number of wells that will be drilled in Payne Co. Try to read as much as possible on the Payne, Logan, Garfield, and Lincoln pages.
http://themilliondollarway.blogspot.com/2014/10/wood-mackenzie-on-s…
Greg what were the results of that hearing?
Greg, did AEP get the spacing increase approved? AEP tried to do that in my section but they were unsuccessful because a smaller energy company that has a well on the other 320 contested it. I understand that they are going to attempt that again at some point but they are going to wait until they get the other 320 spacings increased. What happens in your section will directly affect mine.
Greg, First of all, I highly caution mineral owners to not sell until they are 100% sure they know everything about their minerals. We are at a stage in a massive shale development where there are many more wells to be drilled. Do you know how many wells are yet to be drilled in your sections? Since the reservoirs are gas driven, it’s not unusual for the larger gas wells to be restricted to 640 spacings, so your royalty interest may decease but the 640 spacing insures more production capability, so in the long run, the 640 spacing is better for production. Obviously, someone wants your minerals. Do you know why they want your minerals?
Now, for the late payments and interest. It depends on the amount of your first check. Typically, a company will not voluntarily pay the 6%, so you need to determine if Devon paid it. You can do so by reading your first check stub or calculate your amount of late paid royalty interest proceeds against this OK Tax Commission production report. (select search by legal and enter section, township and range, then hit search) https://www4.oktax.onenet.net/GrossProduction/PublicSearchPUNbyLega…
Then, if they didn’t pay the interest, you might consider sending the DO along with a letter stating their royalty interest check is not timely, politely state they owe the statutory 6%interest and immediate payment of any and all production royalties due from backlog and current production sales including and ask for a copy of the calculations and attach a copy of Oklahoma §52-570.10 as set forth below:
B. 1. Proceeds from the sale of oil or gas production from an oil or gas well shall be paid to persons legally entitled thereto:
a. commencing not later than six (6) months after the date of first sale, and
b. thereafter not later than the last day of the second succeeding month after the end of the month within which such production is sold.
D. 1. Except as otherwise provided in paragraph 2 of this subsection, where proceeds from the sale of oil or gas production or some portion of such proceeds are not paid prior to the end of the applicable time periods provided in this section, that portion not timely paid shall earn interest at the rate of twelve percent (12%) per annum to be compounded annually, calculated from the end of the month in which such production is sold until the day paid.
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a. Where such proceeds are not paid because the title thereto is not marketable, such proceeds shall earn interest at the rate of six percent (6%) per annum to be compounded annually, calculated from the end of the month in which such production was sold until such time as the title to such interest becomes marketable. Marketability of title shall be determined in accordance with the then current title examination standards of the Oklahoma Bar Association.
Steve, Research The Western Interior Seaway, a.k.a. Cretaceous Seaway, the Niobraran Sea, and the North American Inland Sea. It was a huge shallow inland sea that split North America in halves during the early and mid-Cretaceous Period. The sea was flat with a soft muddy bottom fostering fossilization which means to convert into a fossil; replace organic with ‘mineral substances’. http://dictionary.reference.com/browse/fossilized?s=t
“Mineral substances” means oil, gas, uranium, sulfur, lignite, coal, and others and some which are currently of great legal debate: ie silicon and “rare earths".
M.D. I do not know if they got what they wanted, I do not know how to find out.
Martha, again thank you very much. I will call the Clerks office and get the info.Also, on the report you sent me it says it is a Miss well and lists “well Incentives history” and for that Hopkins well it says 6 horizontally drilled, Reduced Rate, Rate 1%, Start date 05-2013, term month 49, 06-2017 Exp Date*.* the incentive may expire earlier than the allotted term, because pay off was reached. What does this stuff mean.
It does not give total production data, I guess that is why you want me to call the Clerks office? Martha you could make a lot of money as a mineral manager, people would gladly pay for your knowledge, I know I would.
Martha, would the 6% be due from 6 mo. from first date of production until the first check I received?