I have mineral rights in Roger Mills County in Oklahoma. We currently have four producing wells in our section. Our royalty payments can go from $1800 a month to $350 the next to $1500 to $300 again. There is no pattern. They can be very low for several months and then 3 months of the larger payments only for it to sink again. This fluctuation is so frustrating. I try to make sense out of it reading the royalty statement, but it doesn't explain the up and down month after month. Could this be a reporting issue that builds up to the larger checks and then back to the smaller amounts? Our checks come from Apache. Is this kind of fluctuation normal? Any thoughts?
Michael:
Several factors could figure into the fluctuations you are seeing in your royalty payments. Some of these factors could be re-working the well whereas the well is shut-in for time, price of oil or transportation issues. I have the same thing happening on my royalty checks from time to time. Your royalty checks are based on timing of when the oil is sold.
Many wells sell oil or gas on an irregular basis due to the volume.
Mr. Mallory is correct lots of variables in the process. If you are trying to plan around the payments, just use the lowest payment you have gotten for a single month. After that, anything more is just jelly on your biscuit.
Most checks come with a readout by well name, quantity either bbl. or mcf, and date of production. Also price is included. It is a good problem to have though isn’t it?
Example, my check from 40A spacing SW, SW, 36 3N 3W was under $500.00 for April 15 and a little under $1600.00 May 15th. High BTU factor for the gas.
The production on the last revenue was for January. It is manna from heaven.
Tom Ed Moore