Royalty check only showed gas and no oil sold


#1

We just received the 7th month check of our royalties on a new well. The check stub showed no oil was sold but a fair amount of gas. The oil was actually a negative $152 ! What issues might possibly cause this? Each of the previous 6 months had both oil and gas products sold. I thought I might get a more accurate answer from our knowledgable members here than calling the company. : ) Thank you


#2

Check the production of the well on the OK tax site. Gross Production

If it is a multi section, then I usually start hunting with the bottom hole section and then work up the hole to find the right filing. Sometimes, they just read a meter wrong out in the field and they make a correction for it. If they sent out first checks before they had an accurate split between two sections, they will correct when they get it figured out. Could be lots of reasons.


#3

It may be a simple as the gas was posted by the cut-off date for the check and the oil was not posted in time. Look at the production dates, as many check pay oil within 30 days and gas within 60 days and so the gas on your current check is the same production month as the oil from the prior check. The well could be shut in for work on it or due to a frac of a nearby well and so there was no oil production for the last month. With a negative oil net payment, there must be adjustments of price, volumes, severance tax, etc. for prior months. Royalty owner relations can walk you through the check stub and explain the well.


#4

Thanks for the responses.
The September 18th production date for oil was indeed on the previous first check which represented 6 months. This second check then only had gas posted for September 18 and then also showed gas and oil posted for Oct 18. Clear as fracked mud, right?