Post production costs

Our attorney doesn't seem to be concerned about this clause in the this customary?

Lessor shall receive its proportionate share of the proceeds less its proportionate share of all costs actually incurred by Leese from the wellhead to the point of sale and its share of all production, severence and ad valorem taxes.

Thats standard in all lease's I have seen. Actually that is benificial to mineral owner also as they can't change how your paid. If your dealing with a reputable oil company operating in your area, all there leases are quite standard and the attorneys know that, but they gladly take your money for glancing at it.

One company I won't mention by name had this in its lease, but it was discovered they were paying based on costs to delivery point instead of wellhead. This was discoverd and I believe they settled out of court for about 140 million $ to mineral owners a couple years ago.

We are to receive the product, be it gas or oil, at the pipeline or the tank, not the wellhead.

When we leased our rights we insured that we get paid at the well head, before any pipeline and trnasport costs. I’m ignorant to all of this but it was my understanding that this would benifit us and it makes sense to me if I get paid at the well head I’m not paying any of the transport costs.