Royalty checks getting smaller every month

General Mineral Rights Discussion
1

I owned 21 net mineral acres in Culberson County Section 40 Block 59

I was getting the royalty check back couple years ago, then the price of oil dropped and the checks kept getting smaller every month. Now it is down to couple hundreds even though Cimarex has discovered a huge new oil reserve in the same area. Now should the check be going up? or not.

If there is anyone in the same predicament as I am let me know.

Louis

2

Louis - That is a great area to own minerals and Cimarex is a good company to have as an operator. The scenario you describe is common for these shale wells; They come on strong at first like when you open a shaken soda but quickly lose that fizz and settle down to a much lower production level over time. I'd bet a lot of us are in that same boat with depressed oil and gas prices and depleting wells. Your checks will increase again someday, and probably substantially, when new wells get drilled on your section. There aren't any new permits on your section right now but that could change any day.

3

Thanks Marcus. Your response give hope.

Louis

4

This oil and gas business is chicken one day and feathers the next. A lot depends upon what happens abroad. Hang in there. Remember, you want that stuff to come out of the ground when the price is high. And when it does, and you are in tall cotton, don't spend that money. Invest it.

Just my opinion.

5

Thanks Robert for your response. It is uplifting,