# Royalties with no lease
**URL:** https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931
**Category:** Karnes County, TX
**Created:** [May 19, 2023, 4:04pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931 "2023-05-19T16:04:41Z")
**Posts on this page:** 10
**Page:** 1
### Author:  [@Karen\_Cash](https://www.mineralrightsforum.com/u/Karen_Cash)
#### Post date: [May 19, 2023, 4:04pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/1 "2023-05-19T16:04:41Z")
In 2017/2018 I verbally negotiated with MRC Energy a lease on above lot in Fall City with no agreement. I was last to offer $600. Lease 3 year, no option, 23% Royalty! I did not hear back.
May 2018 I received Notice of application to Railroad Commission for Encana Oil and Gas for a spacing exception permit well location Bernice Unit 10H, 668.11 acres. I decided not to protest because of legal fees.
My question is should my family receive royalties from this well even if we had no lease?
Thanks, Karen Cash
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### Author:  [@J\_Walker](https://www.mineralrightsforum.com/u/J_Walker)
#### Post date: [May 23, 2023, 2:14pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/2 "2023-05-23T14:14:23Z")
My understanding of this is, since there was no lease, your tracts cannot be pooled by the operator. I suspect your tract was within 330’ of the well bore to be given the opportunity to protest?
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### Author:  [@TennisDaze](https://www.mineralrightsforum.com/u/TennisDaze)
#### Post date: [May 23, 2023, 4:06pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/3 "2023-05-23T16:06:10Z")
Tracts can be included in a well if the operator has any undivided interest under lease. The remaining unleased mineral owners in the tract are essentially treated as working interests who come in after payout. This is different from a well location issue.
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### Author:  [@J\_Walker](https://www.mineralrightsforum.com/u/J_Walker)
#### Post date: [May 23, 2023, 4:33pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/4 "2023-05-23T16:33:49Z")
Thank you Tennis Daze, I should have said “mineral interests” instead of tracts! Wording does matter.
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### Author:  [@Karen\_Cash](https://www.mineralrightsforum.com/u/Karen_Cash)
#### Post date: [May 25, 2023, 11:56pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/5 "2023-05-25T23:56:19Z")
Sorry still do not understand. Should there be royalties for us if producing with no prior lease? Thanks, Karen
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### Author:  [@J\_Walker](https://www.mineralrightsforum.com/u/J_Walker)
#### Post date: [May 26, 2023, 8:46am UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/6 "2023-05-26T08:46:45Z")
[PR0004044909\_0001.pdf](https://www.mineralrightsforum.com/uploads/short-url/loGAiDV9CPidO0yqYwWUyk3Ckk1.pdf) (299.6 KB)
If my attempt was successful, attached is the plat to Bernice 10H. (If not, go to the Texas Railroad Commission Oil and Gas division online query system to launch drilling permit query and look up the permit plat). If your mineral interest is in the rectangular tract outside the unit, no royalties are due.
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### Author:  [@TennisDaze](https://www.mineralrightsforum.com/u/TennisDaze)
#### Post date: [May 26, 2023, 8:47am UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/7 "2023-05-26T08:47:14Z")
If your tract is included in the well and you are unleased, then your total portion of the revenues is paid toward your share of the well costs (drilling, completion, operating) until “pay-out” (recovery of the costs). Then you receive all the revenues for your share of the well and pay your share of continuing expenses. Here is a discussion - [Pooled Units and Unleased Mineral Interests — Oil and Gas Lawyer Blog — December 7, 2009](https://www.oilandgaslawyerblog.com/pooled-units-and-unleased-mine/)
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### Author:  [@Karen\_Cash](https://www.mineralrightsforum.com/u/Karen_Cash)
#### Post date: [May 26, 2023, 12:39pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/8 "2023-05-26T12:39:39Z")
Thank you so much for the information. Karen
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### Author:  [@Karen\_Cash](https://www.mineralrightsforum.com/u/Karen_Cash)
#### Post date: [May 26, 2023, 12:40pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/9 "2023-05-26T12:40:57Z")
Thank you, Tennis. I have saved this information for future reference. It helped a lot. Karen
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### Author:  [@system](https://www.mineralrightsforum.com/u/system)
#### Post date: [August 17, 2023, 4:04pm UTC](https://www.mineralrightsforum.com/t/royalties-with-no-lease/70931/10 "2023-08-17T16:04:46Z")
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