I am close to signing a lease but still have one point I disagree with the Company on. I am getting the advice of an attorney but will not be talking to him until next week. In the meantime I'm curious as to how the "pro's" on the MRF would intrepet this.
On the Exhibit "A" it reads: "Lessee agrees to deliver to the credit of Lessor, free of cost, in the pipeline to which Lessee may connect wells on said land, the equal one-fifth (1/5) part of all oil produced and saved from the leased premises.
Notwithstanding any other provisions of this lease, Lessor's royalty shall be free royalty. Lessor shall not be required to pay and Lessor's royalty shall not be reduced on account of or charged with any of Lessee's costs making the products produced hereunder ready and available for market including, but not limited to, the costs of transporting, compressing, and processing oil, gas, and other gaseous or liquid hydrocarbons, it being the duty of Lessee to transport the same to the purchaser thereof free of all costs to Lessor. Royalty shall be calculated and paid on the price received by Lessee from the purchaser."
I feel the above says I would not have any costs deducted from my royalties while the landman and her management say they are charged deductions from the purchaser and the last sentence allows them to pass my share of the deductions from my royalties.
Anyone have an opinion??